Thyssenkrupp says European green sector under threat

FRANKFURT Reuters -- German conglomerate Thyssenkrupp said on Monday that the European industry was under threat should the continent fail to come up with a plan similar to the U.S. climate package to boost local companies.

The task of policymakers, business and society must be to make the green transformation succeed without deindustrialization, Chief Executive Martina Merz said in a prepared speech ahead of the group's annual general meeting on Friday.

She said that it was the case for Germany with its industrial base, including steel, cement and chemicals makers, which have suffered from higher energy costs, which has caused inflation to go up at a time when they need to decarbonise production.

It has sparked fears that European companies may be moving production to regions where costs are lower, as well as the $430 billion U.S. Inflation Reduction Act IRA to support clean technologies via tax credits.

The European Union said this month it will prepare a law to make life easier for its green industry and back it up with state aid and a sovereignty fund to keep firms from moving to the United States.

That's good because tomorrow's markets are being carved up now, according to Merz, because of a planned spin-off of Thyssenkrupp's steel division, which still needs more clarity in terms of subsidies and energy and raw materials prices.