15 June 2022 | Position
2022 marks a turning point: In the short term, the goal of making the industry towards sustainable has been joined by maintaining production and greater resilience. The latter is to be achieved by reducing our dependency on systemic rivals, among other things.
Converting to sustainable industrial production
The economy is searching for sustainable solutions using new processes - from biotechnology and digitalisation to the hydrogen economy, from new drive technologies to greenhouse gas-neutral production processes. The chemical industry in particular will be dependent on immense amounts of renewable energies and hydrogen in the future. However, this transformation will only succeed if the industry is presented with the right opportunity to pave the way for new policies which lead to innovations and allow for a restructuring of the energy supply. We must support this transformation and not allow lengthy administrative processes to slow it down. Today's rising energy prices are indicative of the risks that arise from poor climate and energy policies. The EU will only achieve its climate protection goals if both the public sector and private industry invest massively in new technologies.
We saw geopolitical considerations take centre stage in 2022 following Russia’s attack on Ukraine. Meanwhile, the West and China are becoming more and more estranged. As a result, Europe must review and redefine its international role and become more active in trade and industrial policy.
Germany can provide inspiration for important ideas when it comes to sustainability and security - but the chances of success only seem to increase with the size of the market. That is why industrial policy has to be shaped at the European level: With the EU, there is a stable framework for the success of transformative and resilience strategies. The EU Industrial Strategy 2021 has made reducing strategic dependencies one of its goals. The goal of the RePowerEU proposal is to reduce dependencies specifically in the energy sector. And it is also important to form international alliances. Global governance in times of geopolitical tension is the greatest challenge of our day.
The political agenda needs a reality check
Politicians in Brussels and Berlin should put their agenda to the test. The industry’s resilience has taken centre stage alongside the issue of transformation which has been exacerbated by supply bottlenecks and the war in Ukraine. In spite of all these issues, EU policy is still strongly focused on its Green Deal - whether that’s in terms of its "Fit for 55” policy or its product policy. We need to analyse the conflicts of interest that arise as a result of this, and do so quickly. The EU's "transition pathway" for chemistry provides us with an opportunity to do just that. As far as Germany is concerned, the Federal Ministry of Economics and Technology and the chemical and pharmaceutical industries already identified target-oriented measures in 2021 that could serve as a template.
THE VCI IS CALLING FOR THE FOLLOWING
- Drive industrial transformation and strengthen resilience
The EU Commission must readjust its EU industrial strategy. Transformation and resilience need to be rebalanced, and EU programmes need to be reviewed. All policy action needs to be well coordinated and support innovation while not overburdening businesses. We need to aim for a powerful European industry - not just self-sufficiency for the EU.
- Investing in and innovating for the transformation of energy and the supply of raw materials
We need to have large amounts of affordable, renewable energy at our disposal if we are to gain independence from Russian gas and oil and transform the industry. The hydrogen and circular economy must be developed and research into chemical recycling needs to be accelerated. We need greater support for research and innovation, we need research and innovation to be open to technology, and we need sufficient funding “Carbon Contracts for Difference" (CCfDs).
- Faster planning and approval procedures
Procedures concerning investment projects in Germany need to be accelerated - for infrastructures and in industry. Digitalisation can assist in this process, but it is by no means a panacea.
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