Almost a third of machinery in the chemical industry in Belgium is idle, many employees are temporarily out of work and large companies are looking to invest in the United States. Against this backdrop, more than sixty top CEOs, Prime Minister Alexandre de Groove and European Commission President Ursula von der Leyen will travel to Antwerp on Tuesday to discuss the future of European industry.
The European Industry Summit will be held on Tuesday at the site of the BASF chemical company in the port of Antwerp. The event is organized by the European Chemicals Consortium CEFIC and its Belgian counterpart Essentia. It is being pulled by Prime Minister de Groove's cabinet, as Belgium will hold the presidency of the European Union for the first half of this year. More than sixty CEOs from international industrial companies such as Solvay, Bayer, ExxonMobil and ArcelorMittal attended.
The key question for all those people at the top is: How can we keep our jobs here and at the same time implement climate-friendly policy? It was no coincidence that the chemical conglomerates chose Antwerp as a location. More than 36,000 people work in the chemical industry in the province of Antwerp, and the Port of Antwerp has the largest chemical companies in the world after Houston, Texas. But the sector is sluggish. In general, approximately 75 percent is used in the machinery and installations of chemical and pharmaceutical companies in Belgium. But at the end of last year it was 68 percent. As the demand for chemical products was low, many machines stood still. As a result, many people in this sector are still economically unemployed. So they are forced to stay at home for a few days in a month and thus get less pay.
Competition from Americans and Chinese
This is partly because labor costs in Belgium are higher than in neighboring countries. But mainly because the cost of gas in the US is five times lower than in Europe, investing in a factory in the US is more profitable for companies. “Also, the US provides many grants through them Inflation Act (IRA). As a result, the cost of building factories in the US has doubled in the past year and a half,” said Pieter van Den Hout, Chief Economist at ING Belgium.
A factory built in America will not be built in Europe. Also, the French and German governments also provide many subsidies to their companies, while the Belgian government has no money for this. And then there's China: because of the country's disappointing economic growth, more and more Chinese companies are moving here to sell their products to Europe, and thus to Belgium. Not just in chemistry, but in the field as a whole. For example, bus builder Van Hool in Koningshuizen (Leer) had to watch in January when its Chinese rival BYD won an order to build 92 electric buses for De Lijn.
Adjust the climate approach
Europe's top CEOs and top politicians want to present a plan on Tuesday to stave off massive job losses in the coming years. This should be done in the 'Antwerp Declaration for a European Industrial Agreement'. Employers' federations are reluctant to say anything in advance about what they believe must be included in that 'deal'. But federations have long pointed out that strict European climate rules are not always possible.
“If Europe's harsh climate approach is not adjusted, few investments will come to Antwerp,” says Pieter Vanden Hout. “Look at a project like Ineos, a chemical company's Project One. It is one of the most environmentally friendly projects in European chemistry, and we are taking great pains to get approval for it. Europe needs to come up with a plan to prevent the industry here from collapsing completely. Now the attitude seems to be: the industry is here, but if it leaves, that's okay too. That attitude will rob us of much of our prosperity. Especially now it seems that Donald Trump is likely to become the next president of the United States. If he wins, the general expectation is that Americans will pursue an even more protectionist policy.
“Passionate analyst. Thinker. Devoted twitter evangelist. Wannabe music specialist.”
More Stories
UNRWA needs money because of US sanctions and is seeking help from Arab countries
More men are getting abortions in the US after new abortion laws
Amazon launches Inspire to compete with TikTok Store in US!