EU Unveils Industrial Acceleration Act to Strengthen Domestic Manufacturing

[Policy Update] The European Union has officially released the Industrial Acceleration Act (IAA), focusing on enhancing the competitiveness of domestic industries.

Core Initiative: Promoting "Made in Europe" through EUR 2 Trillion in Public Procurement

On March 4, 2026, the European Commission announced the Industrial Acceleration Act (IAA), covering strategic sectors such as automotive, wind power, electrolyzers, and steel—collectively representing approximately 15% of EU manufacturing. The legislation mandates a minimum "Made in EU" quota and low-carbon standards in public procurement and subsidies, aiming to reduce reliance on affordable Chinese imports.

Strategic Rationale: Countering Deindustrialization and Reshaping Global Supply Chains

Originally framed with a focus on "decarbonization," the current version places greater emphasis on overall industrial competitiveness and reindustrialization. The Commission plans to deploy over EUR 2 trillion in public funds (equivalent to 14% of GDP) to support domestic enterprises, though internal disagreements persist regarding its protectionist tendencies.

Sectoral Impact: Increased Pressure on Chinese Exports in New Energy and Green Tech

China’s competitive industries—including electric vehicles, photovoltaics, and batteries—will face higher localization barriers, potentially escalating trade tensions between China and the EU.