Britain seeks EU allies to counter France’s ‘Made in Europe’ push

LONDON – Britain is lobbying countries including Germany, Italy and the Netherlands to push back against strict French trade proposals that would exclude Britain from participating in public procurement bids.

As the EU considers local-content requirements for the “Made in Europe” push that forms its response to both US President Donald Trump’s tariffs and wider geopolitical and trade uncertainties, member states are divided on how protectionist the new policies should be, according to people familiar with the matter.

France is pushing for the hardest-line position, British and European officials said, and seeking tough EU-preference rules for goods and services – particularly in industries like the automotive sector, advanced technology and renewable energy.

Though many EU member states support the principle of protecting the continent’s supply chains, several are looking for a landing zone that is less restrictive than the French position, the officials told Bloomberg.

Nations that would be particularly affected by the toughest version of the proposals include Germany, Italy, the Netherlands and Poland, and Britain is asking those countries for help to maintain an open-trading relationship in their mutual interest, the people said, asking not to be named while discussing a matter that is the subject of live negotiations.

They added that Sweden and Finland, as well as the Baltic countries, favoured more relaxed local-content rules.

Spokespeople for the European Commission and the UK’s Cabinet Office declined to comment. 

France’s Industry Ministry said in a statement to Bloomberg that a country that has chosen to exit the EU does not enjoy the same advantages as members, and it is legitimate for European public funds to primarily contribute to the development of the bloc’s economy.

But the ministry also said public procurement remains accessible to countries that allow the same access to their domestic markets and as such there is no issue concerning the UK. 

“The European Union remains open to British exports and wishes to maintain a close partnership with the UK,” the ministry said.

“The segments concerned represent a limited share of the European market – less than 5 per cent – which should allow these issues to be addressed with balance and pragmatism.”

Senior British ministers have publicly raised their concerns about the EU changes since Bloomberg was first to report on them earlier in February.

Chancellor of the Exchequer Rachel Reeves said last week she was “worried” by some of the proposals and that a move towards protectionism “doesn’t make sense”.

Business Secretary Peter Kyle added that he was “deeply worried by some of the voices coming out of Europe”, though he said views on the continent were not “unanimous”.

The discussions have become the most important focus of UK-EU relations in recent weeks, a British official said. 

The European Union is trying to reinvent its economy – which has been falling behind the US and China – by pouring money into dynamic industries such as technology and clean energy. But the bloc is intent on creating large European companies and not letting this money flow outside of its borders.  

The push for EU preference in public tenders is seen as Europe’s attempt to support critical industries amid fierce global competition, and as leverage to ensure other countries apply similar standards when it comes to market openness.

But Britain is urgently trying to dissuade the European Commission from pursuing a course it fears could hurt both sides, officials said. Some EU member states retain concerns that overly restrictive local-content rules could deter investment, increase manufacturing costs and aid competitors, the people said.

The definition of what is considered a “trusted partner” of the EU – in other words, third countries which would receive more generous terms – remains an open issue days before the Commission is due to publish its Industrial Accelerator Act, a key next step in the Made-in-Europe initiative. 

Adoption has been delayed several times already, but Mr Stephane Sejourne, the commission’s industry chief, said the EU is still aiming to adopt the Act on Feb 26. 

British Prime Minister Keir Starmer used his speech at the Munich Security Conference last weekend to call time on the confusion that followed Britain’s exit from the trading bloc and make the case for closer ties.

“We are not the Britain of the Brexit years any more,” he said to loud applause from an audience composed mainly of diplomats and officials.

“Sweden is an ardent advocate of having good third-country participation in most of the activities that the EU is doing, be it EU-led crisis management missions or access for other countries to the European defence market. We think it’s good to have an open EU,” Swedish Defence Minister Pal Jonson told Bloomberg in Munich.

Speaking to reporters after an EU summit last week, Commission President Ursula von der Leyen tried to reassure sceptics, stressing that the EU’s plans would be for strategic sectors and based on “solid economic analysis”. BLOOMBERG