The global net-zero industrial race is on

14. 10. 2024
AUTHOR: Neil Makaroff & Aymeric Kouam

The net-zero transition turns into a strategic choice for strengthening Europe’s economic position globally. The competition is fierce in this domain and the EU is far from being a sole leader, with China and the United States vying to take the lead in this new industrial era.

In its new report ‘‘The global net-zero industrial race is on. A wake-up call for a powerful Clean Industrial Deal’, Strategic Perspectives provides a snapshot of where the EU is positioning in this race compared to China and the United States (US), focusing on some of the main indicators. It allows us to identify the levers for a powerful Clean Industrial Deal. 

  • The EU remains the second most attractive location for net-zero investors in 2023, ahead of the US, reaching $334 billion, $76 billion more than in 2022. However, this position is at risk as Member States have more restrictive budgets and the EU recovery plan will end in 2026.
  • China aims to become the world's monopoly for cleantech, putting European net-zero industries under severe pressures. China alone accounts for 39% of global net-zero investment ($654 billion in 2023), dominates 80% and 60% of the solar and wind value chains and plans to multiply by four battery manufacturing by 2030. 
  • The US positions as a future technological leader by attracting more than a third of the world's investment in clean energy start-ups while Europeans struggle to support and scale up innovation. 
  • Within Europe, some countries are seizing the opportunity of the net-zero race: Poland is becoming a central European cleantech manufacturing hub, and Spain and Denmark are among the leaders in wind energy, creating thousands of jobs. But with Germany and France capturing 45% of net-zero investment, concerns are growing about a two-speed Europe.  

The EU stands at a crucial juncture. No single EU member state can stay in this race alone, not even France and Germany. In fact, Ursula von der Leyen’s proposal of a Clean Industrial Deal can emerge as a timely solution to reposition the European Union at the forefront of the global and technological race to net-zero.

Designing the right policy recipe for the Clean Industrial Deal will be key to regaining a competitive advantage in this new industrial era and to fully taking advantage of the net-zero transition in terms of both transformations and jobs. A mix of investment, innovation standards and support of the industrial base is required to address the challenges that the EU is facing.