How independent should the EU become?

The EU Commission argues about the future industrial strategy. It’s a matter of principle – and personal vanities.

Not at all agreed on content: EU Vice-President Margrethe Vestager and Internal Market Commissioner Thierry Breton

AWhen the European Commission presented its industrial strategy in March last year, the extent of the corona pandemic could not even be foreseen. That is why it has been clear for some time: The industrial strategy needs an update that takes up the lessons from the crisis. Internal Market Commissioner Thierry Breton wanted to present the new industrial strategy on Tuesday. The heads of state and government are due to discuss this in May. But Breton called off the performance in the last few meters. A heated argument has broken out within the Commission over how the EU should respond to the experience of the crisis. On one side there is Breton, on the other the two responsible executive vice-presidents Valdis Dombrovskis and Margrethe Vestager. It is about vanity, but above all about how far the EU abandons its open market policy.

Industry Commissioner Breton openly admits the inconsistencies in the commission. “An agreement based on the principle of the lowest common denominator is not enough for me,” he says in an interview with the Frankfurter Allgemeine Zeitung. “That’s why I decided to postpone the publication of the industrial strategy.” The plan is now to present the strategy in the coming week. How the open points of contention will be settled by then is completely unclear. Both sides have been playing cat and mouse with each other since the commission began to coordinate the text, according to the commission. The teams from Dombrovskis and Vestager deleted entire passages and sensitive sentences from Breton’s drafts, and a short time later they miraculously found their way back into the document.

The frustration around Breton is great. Dombrovskis, and especially Vestager, simply do not understand what is needed now, it says there. They lack an eye for the big picture. They still think like normal commissioners, not like vice-presidents of the commission. “Breton is frustrated because nobody realizes how brilliant he is,” the other side utters. “But if we let it do it, we’ll go straight to the state economy.”

Breton is a man of conviction

Ultimately, as has so often been the case in recent months, the question is how dependent the EU wants to be on preliminary products and raw materials from third countries, how autonomous it needs to be. During the Corona crisis, the heads of state and government tasked the Commission with ensuring autonomous health care. But that is not enough for Breton. “If he has his way, we have to become autonomous, if not self-sufficient, in every respect,” says Vestager and Dombrovskis. The French are committed to believing that they are the only ones who know what to do, and above all better than the industry itself. He dreams of sophisticated indicators for the development of the industry and precise instructions on how to react to certain developments. “Total overkill,” groans an EU official. State fine control and protectionism are not the answer to the Corona crisis, it is said elsewhere.

Breton rejects that. “We don’t want to cut ourselves off from the rest of the world. But we have to act at eye level – and that also means that we make the announcements, ”he says in an interview with the FAZ. It is about the new European semiconductor alliance with which Breton wants to bring the Europeans back to the top in the chip industry . But Breton leaves no doubt that, in his view, the approach needs to be transferred to many other industries. This is the only way for the EU to survive the double confrontation with the United States and China.

If he has his way, the EU must act on the model of battery, hydrogen and chip alliances in a wide variety of important industrial fields, always with the aim of bringing production back to the EU as far as possible, and always under the motto “We make the announcements” when non-EU companies want to participate.

In a way, the dispute mirrors the discussion between Member States. There is also a heated debate there about what the “strategic autonomy” agreed in response to the Corona crisis in autumn 2020 should mean. There, too, traditionally more liberal states such as the Netherlands, Ireland or the Scandinavians are wrestling, especially with France, over how strongly the EU will abandon its previous commitment to open markets.