Brussels should simplify its approvals process for green investments and offer more incentives to help European industry compete with the US, according to the finance chief of the region’s largest steelmaker.
Genuino Christino, chief financial officer of ArcelorMittal, said he was hopeful the EU commission would respond to Washington’s new $369bn Inflation Reduction Act (IRA), which offers green incentives and tax credits.
“What would be good is to see them simplifying the process [and] to match the level of incentives that the US is offering industry,” he told the Financial Times.
ArcelorMittal has in recent months announced plans to invest billions of euros to reduce harmful carbon emissions at four of its sites in Europe.
The €5bn-plus investments, which will be jointly funded with member states, involve moving from carbon-intensive blast furnace steelmaking to electric arc furnaces in Spain, Belgium, Germany and France.
Despite receiving the necessary approvals and funding commitments from respective member states, ArcelorMittal is still waiting for Brussels to ratify the plans.
Christino said he understood that “these are complex projects” and that “it takes time for [the commission] to get a good understanding” but stressed that it would be good to “simplify the application process, the speed with which we get responses”.
“We hope we will get their sign-off anytime soon,” he added.
EU leaders are meeting on Thursday to discuss how to respond to the US legislation amid internal wranglings.
Business leaders have in recent weeks called for higher subsidies to be coupled with cuts to regulation to allow Europe to respond effectively.
Christino said the company was keen to protect its market share in Europe and would continue to invest in the region, as well as its operations in the US.
ArcelorMittal on Thursday said it expected steel demand to recover in 2023 after reporting a near 75 per cent drop in earnings before interest, taxes, depreciation and amortisation to $1.26bn in the final quarter of 2022.
The company’s earnings plunged in the second half of last year after a strong start to 2022 as higher energy costs and lower demand forced the group to either idle or cut output from some of its European blast furnaces.
Carmakers and other customers were also focused on reducing their inventories instead of buying more steel.
The company booked a $1.03bn impairment charge related to property, plant and equipment concerning its operations in Ukraine where it owns a large steel plant in the city of Kryviy Rih.