During the last tripartite meeting, it was agreed that the State will compensate a third wage indexation, potentially triggered in autumn, for several months. “The cost” saved to businesses “is estimated at €60 million per month,” René Winkin said on RTL Radio Thursday morning. The director of FEDIL stressed the importance of the latest agreement between the government and the social partners, which has been dubbed the ‘Solidarity Pact 3.0'.
While the agreement also aims to help companies with their energy costs, Winkin noted that the criteria for these aids are “very selective.” In the eyes of the FEDIL director, the agreement applies a selectivity in this section “which might be lacking in other places.”
For example, “a company’s operation must reach a certain level of energy intensity.” Winkin did acknowledge that improvements have been made since the last agreement. This measure cost €16 million in 2022, as many companies were unable to benefit from it. It is estimated, however, that the cost of this measure will be higher this year, as companies “are starting to feel the high prices.”
There are “a number of industrial companies, which are currently tightening their belts,” according to the FEDIL director, mainly those that rely largely on exports and international imports. While they are not necessarily in a bad situation right now, their turnover “doesn’t look great.”
Addressing the announcement this week that two production lines at Dupont-Teijin Films in Luxembourg are to be closed, Winkin pointed out that in addition to the company stating a supplier was no longer supplying raw materials, other factors also indirectly play a role. These include high energy costs and the fact that the European photovoltaic industry, of which they were a supplier, is no longer flourishing as it used to.
The future of the European industrial policy and the competitiveness of the European Union are other elements that Winkin thinks come into play in this case.
A few years ago, the European Green Deal was created to, among other things, take action against climate change, and “the EU certainly thought that would sort itself out.” According to Winkin, both the United States and China have realised the importance of a climate strategy.
However, the US also established an industrial policy at the same time. The FEDIL director argued that the US is lucky to have the outcomes that these opportunities provide (battery industry, hydrogen, electrolysers, renewables, wind, photovoltaics) at home. “They gave themselves the necessary capacity to have the procedures and therefore access to capital,” Winkin noted.
The two major players (United States and China) are trying to develop all technology domestically, while Europe is “far behind.” Winkin criticised the fact that the EU is only now thinking of establishing an industrial policy, three years after the Green Deal.
“We are lagging behind; this could pose a threat for Europe,” Winkin warned, adding that “Luxembourg will not be spared.” It is high time that Europe implemented concrete projects to strengthen the industry, according to the director of FEDIL. The question is whether the means are there, Winkin said. “Instead of having two MPs bickering in the Chamber of Deputies [Myriam Cecchetti and Dan Kersch], it would be good to have people fighting in Brussels to make a solid industrial policy for Luxembourg.”
