How EU Industrial Policy Got its Groove Back: From Market Orientation to Securitization in the Geoeconomic Era

This paper explores the ongoing transformation of industrial policy in the European Union (EU), highlighting the changing dynamics from market-oriented to securitized industrial policy – that is, from industrial policy aimed at achieving global market dominance to one focused on diversifying supply chains to mitigate geopolitical threats. By reframing the debate over industrial policy in the context of a renewed focus on EU competitiveness, securitization is also redefining political cleavages over EU economic governance. Our study demonstrates that external economic pressures have driven EU Member States to unite around the concept of economic security. After introducing a typology of inward and outward-looking industrial policy instruments, we analyze the shift from market-driven to security-driven strategies using Europe’s industrial policy on battery technology as a case study. This includes an examination of the European Battery Alliance, Strategic Technologies for Europe Platform (STEP), trade agreements, and the Critical Raw Materials Act (CRMA). The paper demonstrates that unity between Member States and the European Commission around the need to reduce economic and energy vulnerability from third parties enabled the transformation of EU industrial policy.