REPORT on the Action Plan for a competitive and sustainable steel industry in Europe
14.1.2014 - (2013/2177(INI))
Committee on Industry, Research and Energy
Rapporteur: András Gyürk
MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION
on the Action Plan for a competitive and sustainable steel industry in Europe
The European Parliament,
– having regard to Article 173 of Title XVII of the Treaty on the Functioning of the European Union (ex Article 157 of the Treaty establishing the European Community), covering EU industrial policy and referring among other things, to the competitiveness of the Union’s industry,
– having regard to the Commission communication of 11 June 2013 on the Steel Action Plan, entitled ‘Action Plan for a competitive and sustainable steel industry in Europe’ (COM(2013)0407),
– having regard to the report of 10 June 2013, commissioned by the Commission from the Centre for European Policy Studies, entitled ‘Assessment of cumulative cost impact for the steel industry’,
– having regard to its resolution of 21 May 2013 on regional strategies for industrial areas in the European Union,
– having regard to the Commission communication of 27 March 2013 entitled ‘Green Paper - A 2030 framework for climate and energy policies’ (COM(2013)0169),
– having regard to the recommendations of 12 February 2013 of the High-Level Round Table on the future of the European Steel Industry,
– having regard to its debate of 4 February 2013, following on the Commission statement, on recovery of European industry in the light of current difficulties (2013/2538(RSP)),
– having regard to its resolution of 13 December 2012 on the EU steel industry,
– having regard to the Commission communication of 10 October 2012 entitled ‘A Stronger European Industry for Growth and Economic Recovery - Industrial Policy Communication Update’ (COM(2012)0582),
– having regard to its resolution of 14 June 2012 entitled ‘Single Market Act: The Next Steps to Growth’,
– having regard to the Commission communication of 30 May 2012 entitled ‘Action for Stability, Growth and Jobs’ (COM(2012)0299),
– having regard to the Commission communication of 14 October 2011 entitled ‘Industrial Policy: Reinforcing competitiveness’ (COM(2011)0642),
– having regard to its resolution of 9 March 2011 on an Industrial Policy for the Globalised Era,
– having regard to its resolution of 11 March 2010 on investing in the development of low carbon technologies (SET-Plan),
– having regard to the Commission communication of 29 February 2012 entitled ‘Making raw materials available for Europe’s future wellbeing; proposal for a European Innovation Partnership on raw materials’ (COM(2012)0082),
– having regard to the Commission staff working paper of 13 December 2011 entitled ‘Materials Roadmap Enabling Low Carbon Energy Technologies’ (SEC(2011)1609),
– having regard to the Commission communication of 8 March 2011 entitled ‘A Roadmap for moving to a competitive low carbon economy in 2050’ (COM(2011)0112),
– having regard to the opinion of the European Economic and Social Committee of 11 December 2013,
– having regard to the opinion of the Committee of the Regions of 28 November 2013,
– having regard to the Eurofound study on social partner organisations: the steel industry,
– having regard to Rule 48 of its Rules of Procedure,
– having regard to the report of the Committee on Industry, Research and Energy and the opinions of the Committee on International Trade and the Committee on Employment and Social Affairs (A7-0028/2014),
A. whereas, following the expiry of the ECSC Treaty, the European coal and steel sectors are governed by the provisions of the EU Treaty;
B. whereas the European coal and steel sector has played an historically significant role in the European integration process and forms the basis for the generation of European industrial value added;
C. whereas the European steel industry is the second largest steel producer in the world and has a strategic importance for several major European industries, such as terrestrial and naval transport, construction, machinery, electrical household appliances, energy and defence;
D. whereas the EU’s share in global steel production has halved over the last ten years, with China now accounting for almost 50 % of world production;
E. whereas global steel demand is expected to increase in the long term and steel will remain a key material for Europe’s industrial value chains, and whereas it is therefore in the interest of the European Union to maintain its domestic production;
F. whereas the European Union should promote a policy of developing industrial production in all the Member States, in order to safeguard jobs within the EU and ensure that the current share of 15.2 % of GDP rises to at least 20 % by 2020;
G. whereas the EU steel industry is an important employer, accounting for 350 000 direct jobs and several million more in related industries, including the recycling supply chain; whereas any form of restructuring has a major impact in the geographical area concerned;
H. whereas, compared with other sectors, industrial relations are strongly organised in the steel industry; whereas this characteristic is made manifest by the high degree of unionisation, the strong presence of employer organisations, which also have a high density, and the high level of collective bargaining coverage; whereas this is reflected at the European level, where the steel industry has been at the forefront in terms of developing social partnership relations;
I. whereas despite the continued efforts of the European steel industry in the area of research and development and its investments aimed at reducing environmental impacts and optimising resource efficiency, its global competitiveness is at risk as a result of several factors:
• the demand for steel has dropped substantially owing to the financial and economic crisis and structural changes affecting certain steel-using sectors;
• its operational costs are substantially higher than those of competitors;
• there is fierce competition from third countries where companies do not operate under the same kind of robust regulatory standards as in the EU;
J. whereas the results of the cumulative cost assessment of the steel sector show that compliance with EU regulations conditions a significant proportion of EU steel producers’ profit margins;
K. whereas we see that EU environment and energy policy creates a difficult business environment for the iron and steel industry, in particular raising the price of energy and making EU manufacturing uncompetitive on the global market;
L. whereas energy costs account for up to 40 % of total operational costs and whereas electricity prices for industrial final consumers in the EU restrict the competitiveness of European companies in a globalised market;
M. whereas the steel industry, especially the special steels sector, is fully global and Europe faces severe competition from third countries while production costs in the EU are higher due to unilateral cost burdens inside the EU caused mainly by EU energy and climate policies leading to a situation where gas prices in the EU are three to four times, and electricity prices double, those in the US;
N. whereas more steel scrap is exported from the EU than is imported into it, and the EU thus loses a substantial volume of valuable secondary raw material, often to the benefit of steel production in countries whose environmental legislation lags behind that of the EU; whereas the EU steel industry is dependent on imports of raw materials, while 40 % of global industrial raw materials face export restrictions, and Europe is exporting large volumes of scrap steel when many countries are restricting exports thereof;
O. whereas the outlook for employment in the steel sector is giving rise to serious concern, since more than 65 000 jobs have been lost in Europe during the past few years owing to capacity reduction or plant closures;
P. whereas the current crisis is creating enormous social hardship for the workers and regions affected, and whereas those companies involved in restructuring should act in a socially responsible manner, as experience has shown that successful restructuring has not been achieved without sufficient social dialogue;
Q. whereas the current crisis has resulted in global overproduction of steel; whereas, however, in 2050 the use of steel and other basic metals is expected to be twice or three times as much as it is at present, and European steel industry needs to survive this ‘valley of death’ during the next few years, to invest and to improve its competitiveness;
R. whereas, for restructuring to be economically successful and socially responsible, it has to be incorporated into a long-term strategy aimed at ensuring and strengthening the long-term sustainability and competitiveness of the company;
1. Welcomes the Commission’s action plan for the steel industry in Europe as an important element to prevent the further relocation of steel production outside of Europe;
2. Welcomes the Commission’s approach of continuing the dialogue between the EU institutions, industry chief executives and trade unions in the form of a permanent High-Level Round Table on steel as well as the European Sectoral Social Dialogue Committees;
3. Welcomes the establishment of the High Level Group on steel, while regretting the infrequency of its meetings, which take place only once a year; considers it essential for regional and local authorities to be closely involved, facilitating and encouraging the participation of the European regions in which the steel companies are based in the work of the High Level Group on steel in order to promote cooperation and exchanges of information and best practice among major stakeholders in the Member States;
4. Emphasises that existing European law on competition and state aid guarantees stable conditions for the steel sector; calls on the Commission to continue to be resolute in following up and penalising instances of distortion of competition;
I. IMPROVING FRAMEWORK CONDITIONS
I.1. Boosting demand
5. Stresses that sustainable growth depends on a strong European industry, and therefore urges the Commission and the Member States to support the strategic development of key steel-using sectors, stimulating investment conditions, including for research and innovation and for the development of skills, creating incentives for efficient and fair production processes (e.g. using standardisation and government procurement policies), strengthening the internal market and advancing European infrastructure development projects in cooperation with all relevant actors;
6. Considers that the construction industry is a key sector in terms of demand for steel, necessitating an in-depth study at EU level on ways of stimulating it by stepping up public works, for the development of not only transport and communications infrastructure but also sectors such as education, culture and public administration, as well as sustainable building and energy efficiency;
7. Draws attention to the importance and advisability of concluding a transatlantic trade and investment partnership for the purpose of increasing trade and demand for steel in key sectors, and stresses, therefore, that negotiations on the partnership should not compromise the EU’s industrial competitiveness in any of these sectors;
8. Asks the Commission to establish an in-depth steel market analysis instrument which could provide precise information on the European and global steel and recycling supply-demand balance, distinguishing between structural and cyclical components of development of this market; believes that monitoring the steel market could significantly contribute to the transparency of steel and scrap markets and provide valuable inputs to corrective and proactive measures which are inevitable due to the cyclical nature of the steel industry;
9. Asks the Commission to use this market analysis instrument to anticipate risks and to investigate how plant closures affect the recovery of the sector;
10. Believes that the Commission, the Member States, the industry and the trade unions should act jointly to retain and attract qualified workers, talented high-skilled scientists and managers to the steel sector, as well as young talent through apprenticeship schemes, thus ensuring a dynamic and innovative workforce; recalls the role of regional universities and industrial research institutes, whose excellence does much to create the regional preconditions for a competitive steel industry; urges the Commission and the Member States to implement immediate actions to avoid the loss of expertise and minimise the loss of jobs; calls for the improvement of planning and management of change by promoting training, upgrading skills and supporting retraining; is worried about the lack of systematic solutions to the generational change and future skills shortages, and about the loss of know-how and competences, and stresses the need to retain and develop the workforce and the skills vital for the future competitiveness of the sector; urges the Commission to promote, through the Erasmus for All and Erasmus for Entrepreneurs programmes, Sector Skills Alliances which, on the basis of data on skills requirements and their evolution, will be devoted to developing and implementing training programmes and common methods, including work-based learning; calls for steps to be taken to strengthen instruments to assist workers and promote vocational training in order to facilitate and support the redeployment of staff employed in the sector following corporate restructuring;
11. Takes the view that the absence of an appropriate industrial policy is causing the European industry to lose its long‑term competitiveness as a result of exceptionally high energy costs; notes that high energy and raw material costs are a consequence not only of the need to import such products from third countries, but also of internal factors; agrees with the Commission that the current restructuring of the steel industry has given rise to social problems by cutting the number of jobs;
12. Calls for account to be taken in the new European strategy on health and safety at work and in policy documents on pensions and other social benefits of the arduous and stressful nature of employees’ and subcontractors’ work in the steel sector, which depends on the production process; stresses that workers in the steel sector are at higher risk of experiencing job strain – being exposed to physical risks and experiencing health problems as a result of their work activity – than the average worker in the EU28;
13. Welcomes the ongoing social dialogue with workers’ representatives and the existence of additional (formal and informal) structures for social dialogue, such as working groups, steering committees, etc., facilitating increased exchanges between workers and employers;
14. Stresses that, to further promote social dialogue in the European steel industry, account must be taken of its specific characteristics, such as the arduous nature of the work involved in steel production, the character of the workforce, environmental concerns, the proliferation of technological innovations and the substantial restructuring under way in the European steel sector;
15. Stresses that the implementation of the Action Plan should also focus on the short-term impact of the economic crisis on the sector’s workforce and competitiveness, and calls on the Commission to closely monitor capacity reductions and plant closures in Europe; is of the opinion that EU funds should not be used to maintain the business activities of certain installations as this would distort competition between steelmakers in the EU, but only to mitigate the impact of closures or downsizing on the workers affected and promotion of youth employment in the sector;
16. Emphasises that restricting demand must not lead to unfair competition for jobs among Member States; calls, in this connection, for a pan-European solution;
17. Calls on the Commission to promote measures aimed at keeping steel production in Europe, ensuring that the relevant employment levels are maintained, and to promote measures to prevent and avoid plant closures in Europe;
18. Asks the Commission to immediately and fully deploy EU funding to reduce the social impact of industrial restructuring; calls, in particular, for full use to be made of the European Social Fund (ESF) and the European Globalisation Adjustment Fund (EGF);
19. Is convinced that involving workers in innovation and restructuring measures is the best way to guarantee economic success;
20. Stresses the need for qualified and skilled people to cope with the transition towards more sustainable production processes and products and calls for a European training and education strategy; welcomes the Greening Technical Vocational Education and Training project for the steel sector, under which steel companies, research institutes and the social partners jointly investigated skills needs for environmental sustainability; calls on the Commission to further support the implementation of its results;
21. Calls on the Commission to draw up a restructuring plan which safeguards and creates good jobs and industrial activity in Europe’s regions;
II. ACTIONS TO IMPROVE THE COMPETITIVENESS OF THE EUROPEAN STEEL INDUSTRY
II.1. Secure energy supplies at affordable prices
22. Notes that, due to the fact that Europe is a resource-constrained continent, energy prices in the EU have risen sharply in recent years, resulting in a marked deterioration in the global competitiveness of the industry in the EU; recognises that energy prices are the most important cost drivers for the steel industry and other energy-intensive industries; believes that the effective functioning of the single energy market, based on price transparency in particular, is a necessary precondition if the steel industry is to be supplied with secure and sustainable energy at affordable prices; highlights the fact that missing cross-border links should be completed and that the existing legislation needs to be fully implemented in order to reap the benefits of a single European energy market; supports the Commission’s promise to step up efforts to decrease the energy price and cost gap between the EU industry and its main competitors, taking into account the strategies of the individual Member States and enabling them to meet their specific national requirements; considers that the Commission should come forward within 12 months with concrete proposals to this end;
23. Stresses that the Commission should address more concretely and in detail the issue of carbon leakage, that the 2030 climate and energy policy targets must be technically and economically feasible for EU industries and that best performers should have no direct or indirect additional costs resulting from climate policies; stresses that the provisions for carbon leakage should provide 100% free allocation of technically achievable benchmarks, with no reduction factor for carbon leakage sectors;
24. Encourages the Commission to develop low-carbon energy deployment strategies, so as to promote the rapid integration thereof on the electricity market;
25. Believes that support should be provided to invest in technologies maximising the utilisation of energy input and energy recovery, for instance by optimising the use of process gases and the waste heat that could be used for steam and electricity production;
26. Considers it necessary to focus more closely on long-term contracts between power suppliers and industrial consumers, cut energy costs and improve international supply grids, this being of key importance to the outlying regions of the EU, thereby helping to discourage relocation to third countries and between Member States; stresses that concluding long-term energy contracts may mitigate the risk of volatile energy prices and contribute to lowering electricity prices for industrial consumers; calls on the Commission to provide guidance on the competition aspects of long-term energy supply agreements;
27. Encourages the Commission to develop strategies for the deployment of low-carbon energies in a cost-effective way and gradually phasing out subsidies, so as to foster the rapid integration of such forms of energy into the electricity market; considers that, in the meantime, offsetting the costs of the overall electricity surcharges for energy-intensive industries should be possible if these are costs which competitors outside the EU do not have to bear;
28. Emphasises that security of energy supply is an important prerequisite for the steel industry; calls on the Member States to implement the Third Energy Package in full; calls on the Member States to ensure secure energy supplies by developing the necessary energy infrastructure projects and to provide appropriate incentives for investors to ensure a lower dependency on imported fossil fuels; encourages the Commission to promote the diversification of natural gas sources and routes and to take the lead in coordinating and supporting safety measures for the supply routes of liquefied natural gas; asks the Commission to conduct a comprehensive assessment of the adequacy of electricity generation and to provide guidance on how to maintain the flexibility of electricity networks;
29. Asks the Commission to produce a report monitoring developments in establishments whose integrity is at risk, as called for in Parliament’s resolution of 13 December 2012 on the EU steel industry;
II.2. Climate protection, resource efficiency and environmental impact
30. Recalls that the European steel industry has reduced its total emissions by some 25 % since 1990; notes that steel is fully recyclable without loss of quality; acknowledges that steel products play an important role in enabling the transition to a knowledge-based, low-carbon and resource-efficient economy; stresses the importance of efforts to further reduce the steel industry’s total emissions;
31. Believes that European steel production should be maintained by a sustainable model of steel production; urges the Commission to draw up and promote European sustainability standards, such as the Steel Construction Products Mark (SustSteel);
32. Stresses the importance of logistical outlay, particularly in the shipping sector, the supply of raw materials, supply security and economic growth linked to port development;
33. Considers that the EU must diversify raw material arrival and distribution locations, since it is vital for the European steel industry to avoid dependence on a single port of arrival for raw materials; considers that a hub for the distribution of minerals to southern and eastern Europe should accordingly be created;
34. Acknowledges the important role of primary steelmaking in the EU in the light of the increasing levels of global steel production and for the production of specific quality levels needed in several European value chains; stresses that producing steel from scrap reduces energy inputs by around 75 % and raw material inputs by 80 %; urges the Commission, therefore, to ensure the efficient operation of the European steel scrap market by improving the functioning of the markets for secondary metal, countering illegal exports of scrap that are wasting valuable raw materials needed by the European economy and by strengthening the capacity of the Member States to carry out inspections on waste shipments under the regulation; encourages the further development of scrap recycling by the maximal collection and use of scrap and improvement of its quality as a way to ensure access to raw materials, reduce energy dependency, decrease emissions and promote a circular economy; supports the Commission’s initiative of inspecting and controlling waste shipments to avoid illegal exports of scrap, often towards countries in which environmental legislation cannot be compared to that of the EU;
35. Urges the Commission to adopt a holistic approach to climate change, environment, energy and competitiveness policy taking into account sectoral specificities; considers that, when regulating, the Commission should look for synergies that will allow the achievement of climate and energy targets while supporting the goals of competitiveness and employment and minimising the risk of carbon leakage and relocation;
36. Calls on the Commission to carry out the next review of the carbon leakage list using an open and transparent methodology, taking into consideration the mitigation enabler role of steel produced in Europe and the indirect impact of electricity prices on competition; urges the Commission to ensure that carbon leakage provisions remain effective by keeping the steel industry on the leakage list;
37. Emphasises that the 2030 climate framework should take into consideration sectoral differences, technological feasibility and economic viability and should, as a matter of basic principle, not give rise to additional costs for more efficient industrial plant;
38. Is concerned about the impact which the recent Commission Decision on Member States’ national implementation measures (NIMs) for the third emissions trading period may have on industry through the application of the cross-sectoral correction factor, which demonstrates that for industry the target is not achievable even with the best available technologies currently applied in Europe, with the result that even the most efficient installations in Europe may have additional costs;
39. Stresses the importance of an effective and reliable infrastructure for the development of the steel industry and recalls that 65 % of world steel production is still ore-based, so that investment in suitable infrastructure covering the whole chain from mining to steelworks and beyond, to export markets, has a major impact on competitiveness, particularly for sparsely populated countries;
II.3. International level playing field
40. Considers that trade negotiations should promote the economic and strategic interests of the Union and its Member States and should follow a reciprocal approach under which considerations such as access to new markets, access to raw materials, risk of carbon and investment leakages, the level playing field and leakages of know-how are taken into account; considers that the strategies should reflect the differences between developed, major emerging and least developed countries’ economies; stresses that access to new export markets in growing economies where European steel can be sold without encountering trade barriers will be of decisive significance for the European steel industry’s potential for growth and development; deplores the fact that some of our trading partners apply unfair, restrictive measures, such as investment limitations and public procurement preferences that protect domestic steel industries, which unduly hamper EU steel exports; also deplores the fact that, since the global crisis started in 2008, there has been increasing intensification of the protectionist measures used by many third countries to support their steel industries;
41. Calls on the Commission to ensure that future trade agreements include provisions which significantly improve export opportunities and market access for European steel and steel-based products;
42. Supports the Commission’s proposal for an impact assessment, including on steel, to be carried out prior to the signature of free trade agreements, taking into account the EU’s manufacturing value chain and the European industry within the global context; asks the Commission to regularly assess the cumulative impact of agreements, both those currently in force and those under negotiation, on the basis of specific, defined criteria, including on the way in which stakeholders are involved;
43. Urges the Commission to ensure that all commitments made in existing and future trade negotiations and agreements are effectively fulfilled; calls on the Commission to fight unfair competition from third countries, using the appropriate measures at its disposal, such as the trade defence instruments or if necessary the WTO dispute settlement mechanism, in a proportionate, rapid and effective way; calls on the Commission to combat unfair protectionist practices by third countries ensuring market access for European companies as well as access to raw materials;
44. Points out that the steel industry is the most frequent user of trade defence instruments; voices its concern regarding the length of time – on average two years – that the Commission needs to instigate anti-dumping measures whereas, in the case of the USA, this period is only six months; calls on the Commission to take steps to ensure that the EU has effective trade defence instruments that can be deployed rapidly and that will enable it to work more swiftly to address cases of dumping, as required as a result of the fierce competition the European industry is faced with in a globalised economy;
45. Urges the Commission to check that the ‘Surveillance 2’ system ensures at least the same surveillance of and monitoring guarantees against unfair subsidies and dumping as the system of prior surveillance of imports of certain iron and steel products laid down in Commission Regulation (EU) No 1241/2009;
46. Stresses that fair trade in steel products can only work on the basis of compliance with basic employment rights and environmental standards;
47. Takes the view that EU standards regarding corporate social responsibility (CSR) and employee participation should also be implemented by European companies in third countries, and that regional development should be promoted;
48. Encourages the Commission to implement the measures proposed to ensure access to coking coal;
49. Asks the Commission to advance the reform of the regulatory framework for financial markets, in order to prevent speculative price volatility, ensure pricing transparency and improve security of supply, of steel as well as raw materials;
50. Urges the Commission to protect European steel with legislative instruments to certify the end use of stainless steel and its chemical and physical composition, inter alia by introducing quality certification for steel-related products that is able to protect EU production from non-certified products;
51. Supports the Commission’s proposal for action to counter illegal markets in steel products; urges the Commission and the Member States to investigate possible measures to combat VAT evasion;
II.4. Research, development and innovation
52. Notes that the widespread dissemination of breakthrough technologies is paramount for compliance with the CO2 reduction pathway envisaged in the 2050 Roadmap; welcomes the objective of the ULCOS programme, namely to identify and develop innovative ultralow carbon steelmaking technologies as well as SPIRE and other programmes to develop new steel grades, production and recycle processes and business models that improve value, efficiency and sustainability fostering the competitiveness of the European steel industry;
53. Calls on the Commission to implement an ambitious innovation policy which clears the way for the development of high-quality, energy-efficient and innovative products and enables the EU to hold its own in the face of ever more severe global competition;
54. Welcomes the results obtained by specific coal and steel instruments such as the Coal and Steel Research Fund and urges the Commission to pursue this course of action, which has been under way since 2002;
55. Considers it necessary to extend support for innovation to all activities related to the steel industry and, hence, in the framework of Horizon 2020, to implement EIB facilities to promote cooperation in the fields of research, development and innovation between steel companies and the regions in which they are located, with a view to promoting sustainable economic activity;
56. Agrees with the Commission that in the framework of Horizon 2020 focus should be put on demonstration and pilot projects for new technologies and cleaner and more resource- and energy-efficient technologies;
57. Believes that incentive mechanisms should be established with a view to encouraging large multinationals to invest in research and development in the regions in which they carry out their industrial operations, for the purpose of supporting employment and the vibrancy of the regions in question;
58. Acknowledges the high financial risks associated with the development, up-scaling, demonstration and deployment of breakthrough technologies; supports the establishment of clusters, research cooperation and public-private partnerships such as SPIRE and EMIRI; encourages the use of innovative financial instruments such as risk-sharing finance facilities, which give priority access to steel industries in crisis; calls on the European Investment Bank and the European Bank for Reconstruction and Development to design a long-term financing framework for steel projects;
59. Asks the Commission to further implement the European Innovation Partnership on Raw Materials, concerning the steel industry and along the raw materials value chain, especially recycling methods and new business models;
60. Instructs its President to forward this resolution to the Commission, the Council and the governments and parliaments of the Member States.
-  http://ec.europa.eu/enterprise/sectors/metals-minerals/files/steel-cum-cost-imp_en.pdf
-  Texts adopted, P7_TA(2013)0199.
-  http://ec.europa.eu/enterprise/sectors/metals-minerals/files/high-level-roundtable-recommendations_en.pdf
-  Texts adopted, P7_TA(2012)0509.
-  OJ C 332 E, 15.11.2013, p. 72.
-  OJ C 199 E, 7.7.2012, p. 131.
-  OJ C 349 E, 22.12.2010, p. 84.
-  Not yet published in the Official Journal.
-  Not yet published in the Official Journal.
-  Eurofound (2009).
-  Eurofound (January 2014, forthcoming).
-  http://www.gt-vet.com/?page_id=18
One of the first steps towards European integration was the coordination of steel production through the establishment of European Coal and Steel Community (ECSC). Besides this historical role of steel, the rapporteur considers that the European steel industry forms the basis for Europe’s key industrial value chains, such as automotive, construction, mechanical and electrical engineering as well as renewable energies. Therefore maintaining a competitive European steel production plays a strategic role in ensuring economic growth and jobs in Europe.
The European steel industry has lost more than 65 000 jobs during the past few years due to the closures of plants. The recovery of the domestic demand is not expected in the short term and the worldwide share of the European companies is shrinking. The European steel industry is at risk since it is suffering from the loss of competitiveness as a combined result of a series of factors.
• The financial and economic crisis has affected the steel-using industries causing a significant drop in steel demand. The construction and automobile sector today represents the half of the market and contrary to other regions the demand is not expected to recover during the upcoming years.
• Emerging countries, especially China, have invested massively in the construction of steel plants during the last years to accompany their high rate growth, creating a worldwide overcapacity problem. The overcapacity has pushed raw material prices up while putting downward pressure on steel prices, which ultimately erodes profit margins.
• Moreover companies located outside of Europe do not comply with equivalent regulatory frameworks therefore they face lower operational costs.
• Steel is an energy-intensive industry therefore the increasing gap between the energy prices in Europe and third countries affects significantly the competitiveness of the steel industry.
The rapporteur welcomes the Steel Action Plan presented by the European Commission and proposes a series of measures to tackle the current situation of the steel industry.
Whereas steel will remain a key material for Europe’s industrial value chains, the rapporteur proposes to boost demand on key steel-using sectors which include new industries with high growth potential. He asks as well for a better monitoring of the market which could help industry to anticipate demand cycles and authorities to fight against illegal practices.
Steel industry provides today 350 000 direct jobs and several millions of workers in related industries, but the adjustment to the crisis resulted in decreasing employment which is accompanied by losses of skills which are difficult to recover when a positive growth cycle will return. Therefore, the rapporteur calls for measures to reduce the social impact of the industrial restructuring including the use of EU funds.
Secure energy supplies at affordable prices
The cost of energy in Europe is excessively high compared to competitors. For the energy intensity industries such as steel, energy prices are important cost drivers influencing the competitiveness of the sector. Therefore the rapporteur believes that the efficient functioning of the single energy market is a necessary precondition for the steel industry to be supplied by secure and sustainable energy at affordable prices.
Climate protection and environmental impact
The rapporteur supports the efforts made by the industry to reduce their environmental impact and acknowledges the mitigation enabler role of steel. Europe shall continue to lead the path to sustainability manufacturing and circular economy while avoiding the risks of carbon leakage and without compromising its competitiveness. Therefore the rapporteur proposes measures to regulate environmental impact while reducing the regulatory costs. The rapporteur advocates for a further development of the steel scrap market as a way to decrease emission and reduce the use of energy and raw materials.
International level-playing field
The rapporteur proposes to fight against asymmetrical commercial agreements, illegal markets of steel products and scrap and furthermore excessive control of some third countries on the flow of raw materials which jeopardize European access to them.
Research, development and innovation
Innovation is the engine of competitiveness. The rapporteur notes that creating an innovative steel industry requires high capital investments associated with high risks and long-term payback periods. Therefore he proposes further measures to foster innovation in Europe through the use of innovative financial instruments. Additionally, the rapporteur asks to concentrate the public spending on the up-scaling of break-through technologies aiming at reducing the environmental impact and the use of energy and raw materials.
OPINION of the Committee on International Trade (28.11.2013)
for the Committee on Industry, Research and Energy
on an Action Plan for a competitive and sustainable steel industry in Europe
Rapporteur: Metin Kazak
The Committee on International Trade calls on the Committee on Industry, Research and Energy, as the committee responsible, to incorporate the following suggestions into its motion for a resolution:
1. Shares the Commission’s view that a strong and competitive steel industry is important for Europe’s industrial base; points out that the EU is the second largest producer of steel in the world, with an output of over 177 million tonnes of steel per year, accounting for 11 % of global output; points out, furthermore, that trade policy can play an important role in promoting the development of the steel industry;
2. Stresses that one of the best ways for the EU to defend its industry is to provide incentives for steel to be produced using the most efficient and fairest production processes; points out that standardisation and government procurement policies play a very important role in creating such incentives, and that the life-cycle costs principle laid down in the EU’s revised government procurement directives also takes account of the negative environmental externalities of production processes;
3. Deplores the fact that some trading partners have imposed unjust trade barriers, such as export restrictions and export duties on raw materials (e.g. ferrous scrap), which have contributed to a reduction in the availability of raw materials and unduly raised steel production costs in the EU;
4. Points out that ferrous scrap is a strategic raw material and supports the Commission’s action to improve freedom of access to raw materials markets, particularly markets for iron ore, coking coal and recyclable materials, and considers that such freedom of access is an important element for ensuring the competitiveness of the European steel industry in global terms; stresses, however, that steel recycling needs to be incentivised to make the EU steel industry more sustainable and more independent from imports of raw materials, to make production more efficient while fostering innovation with regard to production processes and reducing the environmental impact of steel manufacturing along the whole production chain, and in order to boost demand for sustainable steel construction products; urges the Commission to start standardisation activities related to sustainability for steel construction products (SustSteel);
5. Highlights the fact that unjust trade barriers set up by third countries involving such raw materials need to be removed, if necessary, using a reciprocal approach based in particular on the rigorous environmental rules which apply in Europe for the treatment and use of scrap;
6. Deplores the fact that some of our trading partners apply unfair, restrictive measures, such as investment limitations and public procurement preferences that protect domestic steel industries, which unduly hamper EU steel exports; also deplores the fact that, since the global crisis started in 2008, there has been increasing intensification of the protectionist measures used by many third countries to support their steel industries;
7. Stresses that fair trade in steel products can only work in accordance with basic employment rights and environmental standards;
8. Urges the Commission to ensure that all commitments made in existing and future trade negotiations and agreements are effectively fulfilled; calls on the Commission to make an effective and rapid use of EU trade defence instruments, and, in accordance with WTO rules, to resort, if necessary, to the dispute settlement mechanism, and to fight back against unfair trade practices and the intensification of protectionist measures applied by many third countries, which are damaging EU interests, especially where restrictions on raw materials are concerned;
9. Points out that the global steel market is still suffering as a result of overcapacity, estimated at 542 million tonnes; recalls that China accounts for 200 million tonnes of overcapacity, while its overall production represents 50% of total world production;
10. Calls on the Commission to ensure that future trade agreements include provisions to significantly improve export opportunities and market access possibilities for European steel and steel‑based products;
11. Points out that the steel industry is the most frequent user of trade defence instruments; voices its concern regarding the length of time – on average two years – that the Commission needs to instigate anti-dumping measures whereas, in the case of the USA, this period is only six months; calls on the Commission to take steps to ensure that the EU has effective trade defence instruments that can be deployed rapidly and that will enable it to work more swiftly to address cases of dumping, as required as a result of the fierce competition the European industry is faced with in a globalised economy;
12. Urges the Commission to check that the ‘Surveillance 2’ system ensures at least the same surveillance of and monitoring guarantees against unfair subsidies and dumping as the system of prior surveillance of imports of certain iron and steel products laid down in Commission Regulation (EU) No 1241/2009;
13. Takes the view that EU standards regarding corporate social responsibility (CSR) and employee participation should also be implemented by European companies in third countries, and that regional development should be promoted;
14. Supports the Commission’s plan to carry out an impact assessment on the EU industry which takes into account the interests and challenges of the steel sector prior to the signature of free trade agreements;
15. Asks the Commission to regularly assess the cumulative impact of agreements, both those currently in force and those under negotiation, on the basis of specific, defined criteria, including on the way in which stakeholders are involved;
16. Considers that negotiations with our trade partners should be founded on a reciprocal approach that takes into account considerations such as access to new markets, access to raw materials, the risk of carbon and investment leakages, the levelness of the playing field, and leakages of know-how;
17. Calls on the Commission to enter into negotiations with trade partners which import particularly significant volumes into the EU, such as Turkey and Abu Dhabi, with a view to introducing quantitative restrictions;
18. Urges the Commission to develop, as soon as possible, a strategic vision of its industrial policy in an effort, among other things, to help those industrial sectors affected by structural overcapacity, while making trade policy consistent with the EU’s strategic interests;
19. Urges the Commission to monitor scrap markets and reflect on possible measures that could be taken, if necessary, so as to address carbon leakage to non-EU countries;
20. Stresses that innovation in new products (such as high‑strength yet flexible steels) and new production processes is the key to improving the competitiveness of the European steel industry vis‑à‑vis third‑country suppliers and that this area should receive particular support;
21. Is convinced that involving workers in innovation and restructuring measures is the best way to guarantee economic success;
22. Calls on the Commission to take on board the positive experiences of the ECSC, in particular the tripartite strategic considerations and research, and to establish a correspondingly tripartite committee entitled ‘Steel 2020’.
RESULT OF FINAL VOTE IN COMMITTEE
Result of final vote
Members present for the final vote
William (The Earl of) Dartmouth, Nora Berra, Daniel Caspary, María Auxiliadora Correa Zamora, George Sabin Cutaş, Marielle de Sarnez, Christofer Fjellner, Yannick Jadot, Franziska Keller, Bernd Lange, David Martin, Vital Moreira, Franck Proust, Godelieve Quisthoudt-Rowohl, Helmut Scholz, Peter Šťastný, Henri Weber, Iuliu Winkler, Jan Zahradil, Paweł Zalewski
Substitute(s) present for the final vote
Emma McClarkin, Tokia Saïfi, Marietje Schaake
Substitute(s) under Rule 187(2) present for the final vote
Phil Bennion, Jutta Haug, Katarína Neveďalová, Marc Tarabella, Nikola Vuljanić, Roberts Zīle
OPINION of the Committee on Employment and Social Affairs (6.12.2013)
for the Committee on Industry, Research and Energy
on the action plan for a competitive and sustainable steel industry in Europe
Rapporteur: Patrick Le Hyaric
The Committee on Employment and Social Affairs calls on the Committee on Industry, Research and Energy, as the committee responsible, to incorporate the following suggestions in its motion for a resolution:
– having regard to Eurofound’s 2009 ‘Representativeness study of the European social partner organisations: Steel industry’;
A. whereas constant restructuring in the steel sector – owing to, inter alia, the effects of the economic crisis, fierce global competition with increased supply of steel from third countries, increased production costs and lack of smart investments – has led to mass closures of industrial plants, cutting the workforce from 1 million in 1970 to 369 000 in 2012, with a devastating impact on employment levels across whole regions; whereas this trend has accelerated with the current economic crisis, with over 60 000 jobs lost since 2008;
B. whereas centres of steel production form the backbone of local economies, and when these centres undergo any form of restructuring there is a major impact on the whole economic fabric of the areas concerned;
C. whereas the position of the steel sector as a supplier to whole areas of European industry makes it particularly vulnerable to changes in the economic climate, and any economic slowdown leaves it with excess capacity, which is too often used as a pretext for restructuring; whereas its position as an upstream sector gives it a strategic role with regard to the Commission’s declared ambition to re-industrialise in order to boost the share of manufacturing in EU GDP to 20 % by 2020;
D. whereas the future competitiveness and employment potential of Europe’s steel industry is dependent on its capacity to shift towards more efficiency and recycling;
E. whereas, compared with other sectors, industrial relations are strongly organised in the steel industry; whereas this characteristic is made manifest by the high degree of unionisation, the strong presence of employer organisations, which also have a high density, and the high level of collective bargaining coverage; whereas this is reflected at the European level, where the steel industry has been at the forefront in terms of developing social partnership relations;
F. whereas the OECD forecasts that world demand for steel will rise from 1.5 billion to 2.3 billion tonnes by 2025, figures which represent a healthy prospect for the steel industry; whereas the EU possesses first-class skills, know-how, infrastructure and industrial plant, and these should be adapted to meet future demand rather than pruned or abandoned in pursuit of short-term gain or to facilitate the opening up of hypothetical other markets;
G. whereas works closures and redundancies in the steel industry often affect large numbers of employees, and that in many cases there is also a knock-on effect of redundancies in supplier industries and other companies; whereas in the past, this effect has had severe consequences for the economic structure of entire regions, and whereas a sustainable employment policy should therefore be regarded, inter alia, as a form of structural-policy investment at regional level;
H. whereas planned works closure and redundancies threaten to bring about the irrecoverable loss, on a huge scale, of individual workers’ knowledge and experience, as well as the experience of an entire industry sector that has been built up in Europe over centuries;
I. whereas Eurofound will in 2014 publish a report for 2013 entitled ‘Industrial relations practices related to psychosocial constraints at work in the steel sector’;
J. whereas Eurofound will in 2014 publish a report entitled ‘Role of social dialogue in industrial policies’;
K. whereas Eurofound will in 2014 publish a report entitled ‘Working conditions and job quality in manufacturing: sectoral information sheet from the 5th European Working Conditions Survey’;
1. Welcomes the action plan and its proposals, and is convinced that one has to tackle the root causes of jobs reduction, but is concerned at the lack of ambition and concreteness in the action plan for the steel industry in Europe; calls urgently for a strategy that is in line with the goals for a resource-efficient economy and that embraces trade, energy, energy efficiency, environment, R&D, innovation, employment and training policies, in order to close the training gap, curb dumping practices, and combat volatility in the price of raw materials and increases in energy prices; asks, therefore, for a detailed roadmap, with precise timelines for the implementation of the action plan;
2. Calls for enhanced efforts to be made to implement the EU 2020 objectives of smart, sustainable and inclusive growth by promoting a stronger European steel industry; stresses, in this context, the importance of maintaining a strong industrial base in Europe; points out that research, development and innovation are becoming increasingly important, especially as regards the need to develop less resource-intensive methods of production which do not harm the competitiveness of European companies and boost employment;
3. Recommends, as well, that the Member States channel investment into human resources and that they improve the conditions for the exercise of the right to training and learning, while allowing permeability among the various training systems, not only in order to anticipate, and respond to, the demand for skilled labour in a steel industry oriented towards new technologies and an energy-efficient green economy, but also to reinforce the entire production chain, including the basic steel production facilities necessary for the development of high-technology industries;
4. Calls on the Commission and Member States to assess future employment developments in the steel sector for the EU as a whole, and for individual Member States, and to encourage Member States and social partners to draw up adequate plans for training, retraining, mobility and outplacement of workers within the sector; stresses the importance of EU support for training and employment in industrial transition processes in order to retain and develop skills and know-how, to anticipate skills needs, to promote training and skills upgrading; calls for such support to be kept in place and for its use to be monitored; is worried about the lack of systematic solutions to the generational change and the future skills shortages, loss of know-how and competences, and stresses the need to retain the workforce and skills, which are vital for the future;
5. Is of the opinion that healthy economic growth is a prerequisite for boosting demand for steel but also that major infrastructure projects would benefit efforts to encourage demand and foster employment;
6. Calls for competition policy and state aid rules to be reviewed with a view to promoting investment in R&D, employment and training, and to introducing on voluntary basis the possibility of employee participation in the ownership of a company in crisis situations, in order to: reward investment in sustainable quality employment; avoid mass cutting of production capacities; and counter the practice of exporting production capacity and increasing imports in a situation of a temporary overproduction, which will be overcome as the world demand is expected to double by 2050; welcomes the Commission’s public consultation on this topic, to be followed by quick proposals;
7. Calls for higher involvement of social partners at national level in the debate on the implementation of the action plan for the steel industry in Europe;
8. Welcomes the two EU policy instruments involving social partners, namely the European Sectoral Social Dialogue Committees and the High-Level Group for the Steel Industry, as they have made a positive contribution to industrial policy issues in this sector; supports the continuation of the High-Level Group;
9. Endorses the principle that ongoing social dialogue with workers’ representatives should be a requirement; calls for greater cooperation between employers and workers representatives at all levels (EU, national, local and company) for the implementation of the action plan; stresses that existing EU-level arrangements for consulting with workers and keeping them informed must be implemented in a better way; stresses the positive impact of additional social dialogue structures in the steel sector; calls, therefore, on the Commission to submit a proposal for a legal act on employee participation in cases of restructuring, as outlined in Parliament’s own-initiative report 2012/2061; calls for works councils and group works councils to be given new rights and more responsibilities in the steel sector;
10. Underlines the need for long-term strategies allowing enterprises and employees to adapt to structural transformations while anticipating change and minimising social impact; reiterates its call for a legal act on information and consultation of workers, and anticipation and management of restructuring; attaches particular importance to long-term planning for structural change designed to ensure a gradual transition if labour requirements change; stresses that skill levels should be such as to secure employment and allow a transition to new forms of production and business models where necessary;
11. Stresses that steelworkers are considerably more likely than other workers in the manufacturing industries to report being ‘under-skilled’ for their current duties at work; calls for significant investment in skills and training to address skills mismatch in the steel sector and secure the sector’s competitiveness and future viability;
12. Calls for an optional legal framework for transnational company agreements between international trade union federations and companies;
13. Commends the metalworking sector for engaging in cross-border coordination of collective bargaining, and calls on social partners in the steel sector to make optimal use of transnational dialogue in order to counter downward pressures on wages and working conditions;
14. Calls for existing directives on the individual and collective rights of workers and their representatives (Directive 98/59 on collective redundancies, Directive 2001/23 on transfers of undertakings, Directive 2002/14 on a general framework for informing and consulting employees, Directive 2009/38 on European works councils and Directive 2001/86 on involvement of employees, etc.) to be applied in a timely manner, and in full, in all management decisions, and for management not to present employees and their representatives with faits accomplis;
15. Notes that while the EU emissions trading system (ETS) benefits electricity producers, who can carry the extra cost to the electricity prices paid by their customers, the steel sector in global markets cannot increase prices, with the result that employment opportunities are being exported;
16. Emphasises that a binding international agreement on climate change, including as many parties as possible, will afford the European steel industry some degree of protection against environmental and social dumping;
17. Calls for the European Social Fund to be used for the retraining and reskilling of workers and for improvements in lifelong learning, addressing skills needs, skills matching and anticipation of change in the steel industry, taking into account the need to shift towards a less resource-intensive economy;
18. Calls on the Member States to make full use of the European Globalisation Adjustment Fund (EGF) as a short-term measure in the event of plant closures and significant downsizing; reiterates its view that the design of EGF measures should be compatible with the shift towards a resource-efficient and environmentally sustainable economy;
19. Stresses that, in order to enhance further social dialogue on the topic of psychosocial constraints at work in the European steel sector, special attention should be paid to the specific features of working conditions, to identifying sector-specific causes – such as, for example, the heavy nature of steel production work, the properties of the workforce (male, high age structure), environmental concerns, the proliferation of technological innovations and the substantial restructuring of the European steel industry – and to verifying the impact of these causes on the work floor, which can serve to improve sectorial exchange and reflection on prevention practices; stresses further that all key prevention players (be it at European, national or local level), including company management, occupational safety and health services, workers’ representatives, etc.) can prevent psychosocial constraints at work on all prevention levels, meaning that they can continue to make improvements in terms of both health and performance, which are two sides of the same coin;
20. Calls for account to be taken in the new European strategy on health and safety at work, and in policy documents on pensions and other social benefits of the arduous and stressful nature of employees’ and subcontractors’ work in the steel sector, which depends on the production process; stresses that workers in the steel sector are at higher risk of experiencing job strain – being exposed to physical risks and experiencing health problems as a result of their work activity – than the average worker in the EU28;
21. Stresses the need for the Union to protect its jobs in the steel industry, and its social standards in the context of its trade relations, in the drafting of its trade agreements, in its legislation on access to its public markets for third-country undertakings, and in its too rare use of available protection tools against unfair competition from third-country undertakings;
22. Recommends that the Commission and Member States adopt the necessary provisions for the emergence of a European industrial policy which is not weakened by competition between Member States, such as exists at present; recommends, to this end, upward convergence of national social standards and an EU minimum corporate tax rate.
RESULT OF FINAL VOTE IN COMMITTEE
Result of final vote
Members present for the final vote
Regina Bastos, Edit Bauer, Heinz K. Becker, Phil Bennion, Pervenche Berès, Vilija Blinkevičiūtė, Alejandro Cercas, Ole Christensen, Minodora Cliveti, Emer Costello, Frédéric Daerden, Richard Falbr, Thomas Händel, Stephen Hughes, Ádám Kósa, Jean Lambert, Patrick Le Hyaric, Verónica Lope Fontagné, Olle Ludvigsson, Elisabeth Morin-Chartier, Csaba Őry, Siiri Oviir, Sylvana Rapti, Licia Ronzulli, Elisabeth Schroedter, Joanna Katarzyna Skrzydlewska, Gabriele Stauner, Jutta Steinruck, Inês Cristina Zuber
Substitute(s) present for the final vote
Georges Bach, Sergio Gutiérrez Prieto
-  Eurofound (2009), ‘Representativeness study of the European social partner organisations: Steel industry’,http://www.eurofound.europa.eu/docs/eiro/tn0811027s/tn0811027s.
-  Eurofound (2009).
-  Eurofound (2014, forthcoming), ‘Industrial relations practices related to psychosocial constraints at work in the steel sector’.
-  Eurofound (2014, forthcoming), ‘Role of social dialogue in industrial policies’.
-  Eurofound (January 2014, forthcoming), ‘Working conditions and job quality in manufacturing: sectoral information sheet from the 5th European Working Conditions Survey’,
-  European Parliament resolution on the EU steel industry ((2012/2833(RSP)), Texts adopted, P7_TA(2012)0509.
-  European Parliament resolution on information and consultation of workers, anticipation and management of restructuring (2012/2061(INI)), Texts adopted, P7_TA(2013)0005.
-  Eurofound (January 2014, forthcoming).
RESULT OF FINAL VOTE IN COMMITTEE
Result of final vote
Members present for the final vote
Amelia Andersdotter, Josefa Andrés Barea, Jean-Pierre Audy, Bendt Bendtsen, Fabrizio Bertot, Reinhard Bütikofer, Maria Da Graça Carvalho, Giles Chichester, Pilar del Castillo Vera, Christian Ehler, Vicky Ford, Adam Gierek, Norbert Glante, Robert Goebbels, Fiona Hall, Romana Jordan, Philippe Lamberts, Marisa Matias, Judith A. Merkies, Angelika Niebler, Jaroslav Paška, Vittorio Prodi, Miloslav Ransdorf, Herbert Reul, Teresa Riera Madurell, Paul Rübig, Amalia Sartori, Salvador Sedó i Alabart, Evžen Tošenovský, Claude Turmes, Marita Ulvskog, Vladimir Urutchev
Substitute(s) present for the final vote
Daniel Caspary, Françoise Grossetête, Roger Helmer, Jolanta Emilia Hibner, Seán Kelly, Eija-Riitta Korhola, Zofija Mazej Kukovič, Silvia-Adriana Ţicău, Lambert van Nistelrooij
Substitute(s) under Rule 187(2) present for the final vote
María Auxiliadora Correa Zamora