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EU nations will be left far behind the United States unless they address high energy costs that are worsening the continent’s industrial decline, the European Commission said yesterday. To tackle the issue the Commission, the EU executive, is preparing a policy document for later this year followed by an EU summit in February 2014 focused on industry, EU sources said. Industry Commissioner Antonio Tajani said part of the answer is an industrial compact “to address high energy prices, difficult access to credit, a drop in investments, lack of skills and red tape”.
He drew a comparison with the fiscal compact signed in March 2012 by 25 EU leaders with a view to forcing euro zone countries to keep their budgets in surplus or balanced.
Economic output generated by EU industry has fallen to 15,1 percent of GDP from 15,5 percent last year, short of the 20 percent informal goal the European Union should aim for by 2020, the Commission said in a report on industrial competitiveness.
The United States, meanwhile, has been re-industrialising with the help of a cheap-energy boom following the exploitation of shale gas.
Some industry, especially the chemical sector for which gas is a feedstock as well as an energy source, has been relocating to the United States to take advantage of it.
The Commission has said natural gas prices in the European Union are roughly four times higher than in the United States. The gap could narrow, especially if the United States exports more, but that is complicated in terms of domestic politics. – Reuters
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