Political Conditions for Sustainable Innovations

Abstract

The European and German steel industry is currently facing multiple challenges, politically, economically, and technologically. Despite a solid economic development over the last months, structural problems on global markets persist. They are rooted in Chinese over-capacities flooding international markets. Many regions like the US are examining reactions to defend their industries, which leads to even more distortions. European steel companies are suffering from this, both on the import and on export side. Steel industry and partners in the value chain in Europe need political support on the issue of free and fair trade. The second challenge is the non-existing level playing field in international climate policy. While, for example, the US are dropping out of the Paris Agreement, the EU is unilaterally sharpening its climate policy tools. If the current plans on the future design of European Emissions Trading become reality, also best-performing European steel sites will be suffering from this and lose ground in international competition, although they are at the forefront regarding R&D in emission reduction. But projects need time and money to be developed. Together with new possibilities through digitization and through close integration into value creation networks, there are many opportunities for innovative companies. But to play out these advantages companies need a political framework of incentives rather than of regulation.