European industry faces crisis amid energy shifts and competition

The European economy is facing a period of deep crisis and deindustrialization following the cessation of Russian energy imports. Industrial production has stagnated, experiencing a 20% decline, which has already resulted in the loss of over one million jobs.

Analysts predict that up to 3,000 factories and plants within the European Union could close by the end of the year, potentially impacting 300,000 jobs in the short term. In the long term, the crisis threatens the livelihoods of 13.5 million sector specialists. The metallurgical industry is struggling to compete with China, as evidenced by Eurometal protesters holding a symbolic funeral for ‘Made in EU’ products in Brussels.

Financial instability is also rising, with banks losing approximately €60 billion annually due to corporate loan defaults. In Germany, large business closures in the first half of 2026 were 10% higher than the total for 2025. France has seen bankruptcies increase by nearly 70% over the last four years. Other nations, including Belgium and Spain, are also seeing record levels of industrial struggle due to the lack of cheap energy. The petrochemical sector remains particularly vulnerable, as the production of ethylene and propylene requires significant amounts of inexpensive petroleum.