The European Commission announced its RESourceEU Action Plan in December, 2025, committing €3.5 billion in funding to critical raw material (CRM) projects. By Anna Dodd.

Citing risky dependencies on China, the European Commission aims to have Europe and its allies gaining control over CRM projects across the supply chain. China has long dominated the CRM pipeline – from extraction to processing to manufacturing of final products – which poses a risk to Europe’s energy transition goals. But, the Asian superpower has also shined in military security — a salient subject in recent years.

The past year saw China restrict exports on a range of critical minerals and rare earths — first in April 2025, and then again in October 2025. Although these restrictions were mainly implemented in response to United States tariffs under President Donald Trump, the impacts of Chinese restrictions were felt globally, including within the European Union. 

“[China’s] stronghold creates dependencies for the EU and other partners that are increasingly weaponised for geopolitical purposes,” reads a European Commission communication.

From raw materials to critical raw materials

There was a time when these resources were simply that — resources. When did raw materials like copper, rare earths, and magnesium gain the qualifier of “critical”? 

Henry Sanderson, a journalist and author specializing in clean energy and critical minerals, credited Trump as a major player in the global focus towards critical raw materials, dating back to 2017. 

Although the EU released its first raw materials list in 2011, “Trump really catalyzed this focus on critical minerals in his first administration,” said Sanderson, while in conversation with European Business Magazine. The author pointed to a 2017 executive order which called on the US Department of Commerce to develop a critical minerals federal strategy. 

“But it didn’t receive the global attention that it probably should have done at the time.”

Having campaigned under an anti-renewables stance, Trump’s focus on these materials rather stems from his long-held opposition to American reliance on foreign imports, according to Sanderson. But China’s retaliatory measures on U.S. tariffs last year is what has brought renewed attention to this subject more recently.

“I think that highlights some of the weaknesses of [western] democracies — they wait for issues to bubble up till they reach crisis mode, and then they take action,” he said. “But certainly for Trump, since his first time around, he’s been focused on critical minerals.” 

A renewed view on European security

According to the Commission, critical raw materials are essential for a number of geopolitical priorities: clean energy, digital transitions, food security, and defense and aerospace.

A legal expert specializing in corporate energy and mining regulation noted that the narrative surrounding critical raw materials has transformed in recent years.

“Rearmement and massive investments in defense will likely spillover into critical minerals,” said the expert, choosing to remain anonymous for privacy reasons. 

“Much of the infrastructure that is needed for defense, like drones, AI systems, radar and missile guidance — it’s quite metals-intensive and power hungry … If Europe is really serious about rearming and reinforcing its strategic autonomy, it cannot do so while remaining reliant on Chinese electric vehicle batteries and rare earth magnets.” 

But before EU security and military returned to mainstream geopolitical discussions, critical raw materials had already been identified as strategic for the green energy transition. 

The expert observed this change: “What concerns me professionally is that the energy transition is not fueling this trend anymore. Yes, rare earth and battery metals are kind of like the new oil, but resource control itself is the new bargaining power,” he said.

“The question is whether democracies can build secure, ethical, and competitive supply chains fast enough and without resorting to the same extractive zero-sum game they claim to oppose.”

The European stake 

Where countries like the United States and China have been in the critical raw materials business for some time now, the European Union has been late to join. China has been particularly active in Africa, not only taking a leading role in critical raw materials mining, but also investing substantially in various infrastructure projects through its Belt and Road Initiative (BRI). 

Eszter Szedlacsek is a climate policy expert with Vrije Universiteit Amsterdam and research fellow with the Africa Policy Research Institute. She highlighted that comparing China’s influence in Africa to the European Union’s is difficult. 

Under the European Union’s Critical Raw Materials Act (CRMA), several bilateral partnerships in Africa are outlined. “But these are quite opaque,” said Szedlacsek. “So their success and whatever impact they have and however they can compete with the Chinese influence really depends on how they will be implemented.” 

And although the strategic projects in Africa outlined in the CRMA are much more concrete, they are minimal in comparison to China. “Four projects in the entire African continent, it’s not too extensive,” said Szedlacsek, adding, however, that the EU brings its own unique value.

“How the EU tries to differentiate itself is through local value addition, supporting industrialization locally in African countries,” she said.

Similarly, Arthur Leichthammer, a policy fellow for geoeconomics at the Jacques Delors Centre, added that price is not the only consideration when it comes to competition with China. “They’re not competing on price,” he said. “You will not compete on price.” 

Other factors come into play, such as ensuring a safe and reliable trading partner. 

“There are resilience criteria that must be priced in,” said Leichthammer. “If you would assume a frictionless trade, you would just keep on buying from China … you will not be able to rely on China for continuous supply.” 

Cooperating with the United States

In spite of Trump’s recent rhetoric surrounding Greenland and the possibility of a U.S. acquisition – which was met with widespread European opposition – the American government indicated a more collaborative attitude at its February 4, 2026 Critical Minerals Ministerial, seemingly reframing the country’s approach to international relations — at least on the subject of critical raw materials. 

“Today the United States, together with our partners and allies, has set out to reshape the global market for critical minerals and rare earths,” reads the government communication. 

Echoing similar statements from the RESourceEU Action Plan, the U.S. government announced collaboration with over 50 countries, as well as the European Commission. 

“The [critical minerals and rare earths market] is highly concentrated, leaving it a tool of political coercion and supply chain disruption, putting our core interests at risk. We will build new sources of supply, foster secure and reliable transport and logistics networks, and transform the global market into one that is secure, diversified, and resilient, end-to-end.” 

In a joint press statement, the nature of the collaboration between the European Commission and the United States is explained in further detail. Within the next 30 days, a Memorandum of Understanding “aimed at boosting critical minerals supply chain security” will be signed between the two parties.  

What this collaboration means for critical raw materials development in Greenland, demonopolizing China’s role within the market, and the EU’s RESourceEU Action Plan has yet to be seen. 

The post Europe’s Critical Minerals Race Heats Up as Green Transition Faces Geopolitical Risk appeared first on European Business & Finance Magazine.

After 25 years of negotiations, the EU-Mercosur trade agreement cleared a major hurdle on January 9, 2026, when EU member states voted 21-5 in favor, with Belgium abstaining. Commission President Ursula von der Leyen is scheduled to sign the deal in Paraguay on January 17, creating what would be the world’s largest free trade zone covering over 700 million consumers. But the drama is far from over.

The Parliamentary Battleground

The signing ceremony marks the beginning, not the end, of this trade saga. The interim Trade Agreement requires approval from the European Parliament, where lawmakers will vote next Wednesday on a resolution calling for the EU’s top court to assess the deal’s legality. Green MEPs Majdouline Sbai and Saskia Bricmont, alongside Manon Aubry from The Left group, have introduced a draft resolution challenging a “rebalancing mechanism” in the agreement that would allow Mercosur countries to take compensatory measures if future EU laws reduce their exports to Europe.

If the European Court of Justice rules parts of the agreement illegal, negotiations would have to restart—despite the Commission spending a quarter-century hammering out the current terms. French President Emmanuel Macron has made clear that “the signing of the agreement does not mark the end of the story,” signaling Paris’s determination to continue fighting in Parliament.

The Vote That Could Sink Everything

Parliamentary approval is far from guaranteed. Ireland, France, and Poland—whose governments voted against the deal—are unlikely to see their MEPs support ratification. Of Ireland’s 14 MEPs, only Fianna Fáil’s Barry Andrews has committed to voting for the deal. Parties on the far right, the Greens, and other left-wing MEPs are also expected to oppose it.

The centrist majority in Parliament has become increasingly volatile and unpredictable. Commission trade official Sabine Weyand has confirmed that provisional application would not begin before Parliament approves the deal, meaning Germany and Spain’s hopes for swift implementation to counter US and Chinese influence in Latin America remain on hold.

The full EU-Mercosur Partnership Agreement faces an even higher bar: it requires ratification by all 27 EU member states’ parliaments. With France, Austria, Hungary, Ireland, and Poland having voted against it at the Council level, this process is unlikely to be swift—if it happens at all.

Economic Reality Check

The deal’s backers tout impressive numbers: elimination of tariffs on 91% of EU exports to Mercosur and 92% of Mercosur exports to the EU, with an estimated €4 billion in annual tariff savings for European businesses. Sectors like automotive (currently facing 35% tariffs), wine and spirits, dairy, and pharmaceuticals stand to benefit significantly.

However, the European Commission’s own estimates reveal a more modest reality: the deal will add only 0.05% (around €90.2 billion) to the EU’s economy by 2040. This reflects historically low trade volumes between the blocs, even with Brazil—Latin America’s largest economy—included.

For Mercosur countries, the economic benefit is likely greater. Standard Chartered economists note that while the EU views the agreement primarily as a geopolitical win amid damaging US reciprocal tariffs and increased competition with China, the South American bloc stands to gain more economically.

The Farmer Revolt Continues

Agricultural lobbies remain the deal’s most formidable opponent. The agreement establishes a phased quota of 99,000 metric tons of beef at reduced tariffs and 180,000 metric tons of duty-free poultry. Irish Farmers Association president Francie Gorman has called it “the height of hypocrisy,” warning that European markets will be undermined by cheap imports produced to lower standards.

Farmers in Belgium, France, and Poland have staged tractor blockades and protests, with Brazilian beef selling at prices 20-30% lower than European production. The Commission has attempted to assuage concerns with safeguards that can suspend imports of sensitive farm produce, strengthened import controls for pesticide residues, a crisis fund, and accelerated farmer support—but these concessions failed to win over France or Poland.

Geopolitical Stakes Rise

The timing underscores the deal’s strategic significance. As Washington embraces the “Donroe Doctrine” with military intervention in Venezuela and threats against Greenland, Europe and South America are choosing partnership over confrontation. China has rapidly increased its footprint in the region, now buying roughly 30% of Brazilian exports compared to the EU’s 16%.

Von der Leyen framed it starkly: “At a time when trade and dependencies are being weaponized and the dangerous, transactional nature of the reality we live in becomes increasingly stark, this historic trade deal is further proof that Europe charts its own course.”

The next few weeks will determine whether 25 years of negotiations culminate in Europe’s largest-ever trade deal—or whether the parliamentary battlefield becomes its graveyard.

The post What Are The Vital Next Steps In The EU-Mercosur Trade Deal Saga? appeared first on European Business & Finance Magazine.

Energy costs 4x higher than US rivals are gutting the sector — and here’s what happens when a critical industry dies.

Q: Why is Europe’s chemical industry struggling?

A: Europe’s chemical sector faces an existential crisis due to energy costs 3-4 times higher than US competitors, cheap Asian imports, carbon regulations and ageing infrastructure. Domo Chemicals’ insolvency represents a wave of failures expected across the €565 billion industry.

Belgian group’s German subsidiaries collapse amid weak demand, Chinese competition and surging energy costs in latest sign of sector’s structural decline

The insolvency of three German subsidiaries of Belgium’s Domo Chemicals has laid bare the existential crisis facing Europe’s once-dominant chemical sector, as industry executives warn that 2026 will bring a “painful continuation” of plant closures and production shifts away from the continent.

Domo Chemicals, Domo Caproleuna and Domo Engineering Plastics—employing 585 workers at sites in Leuna and Premnitz—filed for insolvency late last month after negotiations over short-term financing broke down. The Ghent-based parent company, which manufactures polymers and engineering plastics for the automotive and industrial sectors, cited persistently weak demand, soaring energy costs and a flood of imports from China as primary culprits.

The collapse is symptomatic of broader malaise. Industry analysts estimate that three-quarters of Germany’s energy-intensive chemical companies are now shifting investments abroad, with production increasingly migrating to regions with cheaper feedstocks and lower regulatory burdens.

“Producing basic chemicals in Germany is becoming increasingly unattractive—now the industry is migrating,” says Jan Haemer, a partner at consultancy Simon-Kucher. High energy prices and regulatory uncertainty around sustainability legislation are driving the exodus, according to the firm’s analysis.

Lucas Flöther, the preliminary insolvency administrator appointed by German courts, emphasized that day-to-day operations at the affected sites continue uninterrupted. Employee wages are secured for three months through statutory insolvency benefits, providing breathing room while restructuring options—including potential investor solutions or creditor settlements—are explored.

Yet the structural headwinds remain formidable. Domo attempted a restructuring programme throughout 2024, but management ultimately concluded the effort was insufficient against the combined weight of anaemic European demand and relentless price competition from Asian imports, particularly polyamide resins from China.

The Domo insolvency follows a cascade of closures and downsizings across European chemicals. Swiss specialty chemicals firm Clariant told the Financial Times in late 2025 that it anticipates “more production shifting away from Europe,” with over half its sales growth in the next five years expected to come from China. BASF, Europe’s largest chemical producer, has cut 2,600 jobs at its flagship Ludwigshafen site. Evonik axed 2,000 positions. Dow is shuttering operations in Barry, Wales, and Terneuzen in the Netherlands.

In the Netherlands, another caprolactam producer, Fibrant, is evaluating major reorganization options. Across the Channel, some 60 per cent of UK chemical firms surveyed by the Chemical Industries Association reported declining sales, with site closures mounting.

“Chemical plants are up for sale and closing on an unprecedented scale in Europe,” says Richard John Carter, an independent consultant and former BASF executive. “2026 will see a painful continuation of the pressure to review traditional business models and beliefs.”

The crisis has multiple dimensions. Europe’s chemical production volumes have dropped 6 to 8 per cent from pre-pandemic levels, with Germany experiencing declines as steep as 15 per cent. More than 20 major plants have closed across the continent in the past two years, reducing ethylene cracking capacity by 8 to 10 per cent.

Energy costs remain the sector’s most acute challenge. While natural gas prices have retreated from the peaks reached after Russia’s invasion of Ukraine, they remain approximately 40 per cent above pre-2022 levels, according to BASF. Meanwhile, US producers benefit from abundant shale gas, and Middle Eastern and Asian competitors enjoy advantaged access to low-cost feedstocks.

The competitive disadvantage is compounded by European regulatory complexity. The Carbon Border Adjustment Mechanism, designed to prevent carbon leakage by taxing imports from regions with laxer environmental standards, currently applies only to fertilizers and hydrogen—leaving most chemical products unprotected from cheaper, higher-emission imports.

“I don’t think anything on the legislative front is going to be happening quickly enough to stop the near-term closures,” says Stewart Hardy, a consultant with FGE NexantECA.

Marco Mensink, director general of the European Chemical Industry Council, warned last year that the sector is “beyond the breaking point,” calling for urgent action on energy affordability for an industry that directly employs 1.2 million workers.

The chemical sector’s troubles ripple through interconnected supply chains. Automotive manufacturers, already grappling with the transition to electric vehicles, face disruption as their chemical suppliers struggle. The broader deindustrialization threatens Europe’s ambitions for strategic autonomy in critical materials and advanced manufacturing.

Some analysts argue that specialization offers a path forward. Europe retains strength in specialty chemicals, high-purity polymers and green chemistry. Companies like Clariant, Evonik and Solvay lead in innovation, and the continent’s commitment to decarbonization could theoretically create competitive advantages in sustainable chemical production.

But Carter cautions that “specialties will not provide sufficient impetus to replace the collapse in commodity margins.” The harsh reality is that without affordable energy and streamlined regulation, Europe’s chemical industry faces continued erosion of its production base—regardless of technological prowess or environmental credentials.

For the 585 Domo employees awaiting their fate, and thousands more across Europe’s chemical belt, the question is no longer whether the sector will shrink, but how rapidly—and whether policy makers will act decisively enough to preserve what remains of the continent’s industrial chemistry capacity.

The post Domo’s Collapse Shows Europe’s Chemical Crisis Is Worsening appeared first on European Business & Finance Magazine.

As businesses return from 2025’s holiday trading season, new data has revealed that food waste continues to erode margins and is one of the most costly, yet hidden, challenges in the global retail supply chain.

This is according to the Making the Invisible Visible: Unlocking the Hidden Value of Food Waste to Drive Growth and Profitability report, published today by Avery Dennison, a global materials science and digital identification solutions company. Independent modeling warns that the economic cost of food waste across the global supply chain is forecast to reach $540 billion by 2026¹, up from $526 billion last year.

In addition, the report findings show that, on average, food waste costs are equivalent to 33% of total revenues in the food retail supply chain annually from post-farm up to the point-of-sale.

Extensive research involving 3,500 global food retailers and supply chain leaders reveals that, despite growing awareness, 61% of businesses say they still lack full visibility into where food waste occurs across their operations. Limited influence over the most waste-intensive areas of the supply chain is a common challenge, highlighting the urgent need for targeted innovation and cross-supply chain collaboration.

The data highlights how leaders are consistently challenged at various points throughout the supply chain and most specifically across perishables. When asked to identify the three most difficult categories for waste, half pointed to meat (50%), 45% cited produce, and 28% mentioned baked goods. Over half (51%) of business leaders said that inventory management and overstocking contribute significantly to food waste within their operations. Tackling this will require a combination of solutions, including item-level inventory visibility, demand forecasting and real-time shelf-life management.

Transit remains a connecting thread between the different perishable categories, with 56% of companies reporting that they do not have a clear understanding of how much food waste happens when goods are being transported.

If current trends continue, the cumulative cost of food waste from 2025 to 2030 is expected to reach $3.4 trillion², coinciding with the 2030 deadline for the UN’s Sustainable Development Goal 12.3, which aims to halve global food waste³. Despite this goal, the report uncovered that over a quarter (27%) of leaders said that they would not meet the 2030 deadline.

Julie Vargas, VP/GM, Enterprise Intelligent Labels Growth at Avery Dennison, says: “Food waste has become an accepted cost of doing business, but it doesn’t have to be. Innovation exists today to help overcome the complexity of food waste by unlocking new possibilities and transforming a historic operating cost into measurable value across the global retail supply chain.

“The retail ecosystem is changing, but not enough retailers are changing with it. The biggest challenge is what we can’t see. From transit to shelf, blind spots are silently eroding margins. With the right innovation, we can turn this loss into measurable value and shift the conversation on food waste, from being purely seen as a sustainability issue, into a business critical one. This is about unlocking efficiency and growth across the entire supply chain.”

A high cost challenge intensified by the holiday season

 Meat has emerged as one of the most difficult categories for waste management, with 72% of supply chain leaders citing it as their biggest challenge⁴. Given its high unit cost in grocery and food retail, even small reductions in waste can deliver significant financial gains. Economic modeling forecasts meat waste to amount to $94 billion in lost output across the global supply chain in 2026, almost one fifth of the total cumulative loss across the year, with fresh produce closely behind at $88 billion.

Just ahead of peak season trading results are announced, Avery Dennison found that over two thirds of businesses (67%) were predicting that meat waste during the holiday season was expected to noticeably reduce their margins and that managing this issue over one of the busiest times of the year had become a bigger operational concern than before (69%).

For retailers, pressures presented by economic volatility, poor adaptability to market-related shocks and difficulty adjusting to shifting consumer demands are exacerbating systemic food waste issues. Almost three quarters (74%) of retailers admit inflation is making it harder than ever to predict demand for fresh meat and 73% report a rising demand amongst consumers for smaller meat portions or alternatives.

Michael Colarossi, vice president, head of enterprise sustainability, Avery Dennison, adds: “For too long, food waste has been positioned almost exclusively as a sustainability and societal issue. We must recognize it as the business opportunity it truly is. In fact, over seven in ten (73%) business leaders told us that they see tackling food waste as a growth opportunity. That’s why the $540 billion in lost value should be a clear call to action for the food retail supply chain to cut waste and boost efficiencies. Only by uncovering the blind spots in the chain can we take meaningful steps to reduce loss, build resilience and create lasting value for both businesses and the planet.”

The post Why Global Food Waste Will Cost the Economy $540bn in 2026 appeared first on European Business & Finance Magazine.

The EU’s carbon border mechanism has entered into force, reshaping trade flows and raising costs for exporters into the single market.

The European Union has entered uncharted territory in global climate policy. On 1 January 2026, the Carbon Border Adjustment Mechanism (CBAM) transitioned from a two-year reporting phase into its definitive regime, requiring importers to purchase certificates and pay fees based on the carbon emissions embedded in their products. The move makes the EU the first major economy to implement a fully operational carbon border tax, marking a watershed moment in the bloc’s ambitious drive toward climate neutrality by 2050.

From Transition to Implementation

CBAM’s journey began in October 2023 when importers of carbon-intensive goods first faced quarterly reporting requirements for embedded emissions—without any financial penalties. That transitional phase, designed as a “pilot and learning period,” allowed companies and authorities across the globe to adapt to the new system, test methodologies, and build compliance infrastructure.

Now, the stakes have risen considerably. From 2026 onwards, EU importers of goods exceeding 50 tonnes annually must obtain authorized CBAM declarant status and purchase certificates corresponding to the carbon dioxide emissions generated during production. The mechanism currently covers six sectors identified as particularly carbon-intensive and at risk of carbon leakage: cement, iron and steel, aluminium, fertilizers, electricity, and hydrogen. Together, these sectors represent more than 50% of emissions in industries covered by the EU’s Emissions Trading System (ETS).

The pricing structure is straightforward but potentially expensive. CBAM certificate prices mirror the EU ETS allowance price, which has recently ranged between €70 and €100 per tonne of CO2. Importers must surrender certificates annually based on verified emissions data, with the first declaration covering 2026 imports due by September 2027. Crucially, if exporters can demonstrate that carbon prices have already been paid in their country of origin—and those prices are recognized by the EU—those costs can be deducted from their CBAM obligations.

Economic and Trade Implications

The financial impact extends far beyond abstract policy frameworks. The European Commission estimates that CBAM could generate approximately €2.1 billion in annual revenue by 2030 as the scope expands and payment obligations increase. A portion of these revenues—€1.5 billion through 2028—has been earmarked for a Temporary Decarbonisation Fund designed to help EU industries cope with the implementation phase and maintain competitiveness in global markets.

For businesses, CBAM represents a fundamental shift in how carbon pricing influences international trade and supply chain decisions. Companies exporting to the EU now face a choice: invest in cleaner production processes to reduce embedded emissions, or absorb the additional costs of CBAM certificates. The mechanism is already spurring international responses, with countries from Egypt to India considering their own domestic carbon pricing systems to shield their industries from EU charges.

The trade tensions are palpable. The United States has pressured Brussels to withdraw or modify the law, arguing it creates massive barriers to transatlantic commerce—particularly concerning given that Washington tripled tariffs on EU goods and raised steel and aluminium duties to 50% earlier in 2025. China, India, Russia, and South Africa have similarly voiced opposition, characterizing CBAM as protectionism disguised as climate policy and raising questions about its compatibility with World Trade Organization rules.

Industry Concerns and Compliance Challenges

European industry itself harbors mixed feelings about the mechanism. While CBAM aims to protect EU producers already paying carbon costs under the ETS, critics argue the system remains too complex and burdensome. Accurately measuring embedded carbon emissions—particularly for products with complex global supply chains—presents significant technical and administrative challenges.

Jean-Marc Germain, CEO of Constellium representing the aluminium industry, warned that CBAM “risks weakening European aluminium competitiveness without delivering meaningful emissions reductions.” The concern reflects a broader anxiety: that the mechanism could inadvertently disadvantage European manufacturers competing in global markets while providing only marginal climate benefits if production simply shifts to jurisdictions with looser reporting standards.

The compliance burden falls heavily on importers, who must navigate intricate methodologies, obtain verified emissions data from foreign suppliers, and submit detailed annual declarations. Small and medium-sized enterprises importing less than 50 tonnes annually are exempt, covering roughly 90% of importers but only 1% of emissions—a deliberate design choice to focus enforcement where it matters most while minimizing administrative overhead.

Global Ripple Effects and Future Expansion

Despite the controversy, CBAM’s influence extends well beyond Europe’s borders. The European Commission’s post-transition review found that the policy has already motivated more countries to adopt carbon pricing systems, viewing them as both climate tools and shields against CBAM charges. This represents a potential diplomatic victory for Brussels, which has long championed global carbon pricing as essential to addressing climate change.

The EU has signaled intentions to expand CBAM’s scope beyond the initial six sectors. Proposals under consideration include downstream products containing high proportions of steel and aluminium, as well as potential future coverage of chemicals and other industrial materials. The Commission has also floated the possibility of including indirect emissions and Scope 2 electricity consumption in future iterations, further broadening the mechanism’s reach.

The phase-in remains gradual and deliberate. Until 2034, CBAM will only apply to the proportion of emissions not covered by free ETS allowances, which are being phased out over the same period. In 2026, importers will pay only a small percentage of the full carbon cost—approximately 2.5%—with that share increasing annually until reaching 100% in 2034 when free allocations disappear entirely.

A Test Case for Global Climate Governance

CBAM represents more than a technical trade mechanism—it’s a test of whether climate ambition can be reconciled with economic competitiveness and international cooperation. The EU is betting that carbon border adjustments will drive decarbonization in heavy industries without undermining its own industrial base or triggering destructive trade wars.

The coming years will determine whether that gamble succeeds. If CBAM catalyzes global carbon pricing and cleaner production methods, it could become a model for other jurisdictions. If it instead generates protectionist retaliation and supply chain disruption, it may force Brussels back to the drawing board. For now, businesses worldwide are adapting to a new reality: the price of carbon is no longer confined within national borders, and access to the world’s largest single market increasingly depends on demonstrating environmental credentials through verified emissions data.

Further Reading

• Europe 2026 Outlook: Defence, Energy, Finance and the New Power Economy
• EIB Group Approves €17.7bn Investment for Strategic Industries
• Europe’s Friction Economy: Impact on Business and Trade

The post What the EU’s Carbon Border Tax Means for Global Trade appeared first on European Business & Finance Magazine.

The EU has promised to cut food waste by as much as 30% by 2030, and while this is a promising step, legislation alone won’t get us there. The real challenge? Waste is still being seen as rubbish, a liability rather than a resource. 

We throw away 59.2 million tons of food every year across the continent. That’s the equivalent of €132 billion in economic losses, alongside wasted land, water and energy used to produce that food. In addition to the economic consequences, food waste also has environmental, and health consequences because of the significant methane emissions generated during decomposition. 

While overhauls in agriculture, manufacturing and consumption patterns will take time, private sector innovations can support in turning waste into a resource, closing the gap as we work towards establishing a truly circular economy.  

Europe must rethink its ‘take, make, dispose’ mindset, otherwise we risk locking ourselves into wasted potential, higher costs, higher emissions and huge pressure on our economy and daily lives.  

This is where business has a real chance to step up, even get ahead of, and complement regulation. The private sector is often called out for their role in reforming food waste systems, but they are the best positioned to show what is possible. 

Implementing circularity is the first step. And by circularity, I mean reusing everything they possibly can – especially what’s considered “waste”. 

It’s time more businesses broke out of the linear business model and prove that circularity isn’t just good practice; it’s crucial for their competitiveness and bottom line. 

Circularity is a business opportunity 

Let’s be clear: circular supply chains are all about staying competitive. Global estimates suggest that embracing a true circular economy could generate $4.5 trillion in growth by 2030.  By reusing resources, reducing extraction and cutting energy costs, businesses can strengthen supply chain resilience and unlock new revenue streams. 

For example, converting food waste into bioplastics or organic animal residues into bioenergy reduces reliance on valuable natural resources. Repurposing surplus ingredients into new products creates additional revenue lines, and using recovered energy from organic waste can lower operational costs. These approaches not only protect companies against market volatility but also drive scalable innovations that align with Europe’s long-term ambitions. 

Relying on outdated systems won’t deliver true circularity. We need new business models and technologies that redesign waste from the outset – not just try to manage it after the fact.  These technologies can help bridge the gap. 

Yet despite 55% of large businesses claiming circularity commitments, most still struggle to embed them across operations – a symptom of the persistent “linear mindset.” 

But there is no denying that there are businesses out there already proving what’s possible by turning waste into value. 

To shed some light: surplus bread has been turned into beer by Toast Brewing in the UK and Breer in Hong Kong are doing something similar with discarded loaves. Italian company Orange Fiber transforms citrus peels into textiles sold to luxury fashion houses, Kaffeeform turns used coffee grounds into durable cups, trays, and furniture. Nangli Dairy in India has launched a large-scale biogas plant that converts cow dung into compressed natural gas and compost.  

This entrepreneurship – spanning food and beverage, fashion and energy – shows that what was once dismissed as waste is in fact a powerful resource, capable of fueling entire industries and redefining competitiveness through innovation.  

The cost of inaction 

If Europe fails to fully embrace efficient technologies that support circularity, it will lose more than resources – it will also lose its competitive edge.  

Circular models aren’t a-nice-to-have – they’re becoming a baseline expectation. Investors and consumers are demanding them, and reporting requirements are increasingly mandating them. The future market is one where waste is designed from the start, and the businesses that act now will be the ones defining it. 

Europe cannot legislate its way out of waste. It must empower businesses and innovators to treat circularity as a core strategy. Those that act early will gain market share, reduce costs and strengthen resilience against supply chain shockwaves. 

Europe can’t afford to waste this opportunity 

Food waste persists, resources are tightening and emissions are climbing. The private sector has both the responsibility and the tools to turn this tide – using innovation to turn waste into value and unlock a trillion-dollar market. 

Waste is not a liability; it is the raw material of the future. Every ton left unused is a missed business opportunity. 

Jack (Tato) Bigio‏ – ‏Co-Founder and Chief Growth and Sustainability Officer, UBQ Materials 

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Henrietta Worthington

As part of its green taxonomy, the EU is clamping down on the use of sustainability labels by setting strict requirements for consumer facing labels. From 27 September 2026, it will be prohibited to display a sustainability label in the EU that is not based on a “certification scheme”. The new rules were adopted in February 2024 and must be transposed into national law by 27 March 2026. However, many businesses, and scheme owners themselves, have not yet started updating their processes. Firms that continue to display uncertified labels after the implementation date could be committing an unfair commercial practice, leading to possible fines, injunctions, and reputational damage.

Legal background

EU Directive 2024/825, commonly known as the Empowering Consumers Directive (the ECD), was introduced to empower consumers to make more sustainable consumption choices by providing them with clearer information about the environmental and social impacts of their purchases. It is estimated that there are currently more than 200 different environmental and sustainability labels circulating in the EU market, leading to consumer confusion. Many of these labels lack transparency, scientific basis, or oversight, meaning that consumers struggle to identify credible sustainability labels, thus undermining consumer trust.

The ECD bolsters two pieces of existing consumer legislation: the Consumer Rights Directive and the Unfair Commercial Practices Directive; and expands upon a list of prohibited commercial practices which were established by the existing directives. In addition to imposing strict requirements for sustainability labels, the ECD further enhances consumer protections through various measures including prohibiting the use of vague or ambiguous environmental terms; limiting future environmental performance claims; and requiring transparency for claims relating to offsetting. 

Requirements for Sustainability Labels

Specifically, the ECD prescribes that a sustainability label may only be used if it is based on an independent certification scheme or established by a public authority. It then proceeds to define a “certification scheme” as a third-party verification scheme that certifies that a product, process or business complies with certain requirements, and allows for the use of a corresponding sustainability label. Certification schemes must also be publicly available, and meet specific criteria detailed in the ECD, requiring such schemes to be transparent, fair, and nondiscriminatory to all traders willing and able to comply, as well as developed in consultation with relevant experts, monitored for non-compliance and independently audited based on international standards and procedures. Given the increased scrutiny of certification schemes, in order to ensure compliance with the ECD when displaying sustainability labels, scheme owners should take steps to ensure that their certification schemes meet the prescribed ECD criteria.

The requirements for a “certification scheme” under the ECD are intentionally non-prescriptive to allow for them to be satisfied in a variety of ways. The provisions are non-sector specific, meaning that they are sufficiently broad to function across sectors and industries. However, this also creates increased scope for misinterpretation, and it is likely that litigation will be required to clarify the interpretation of the more opaque provisions. It is anticipated that the EU will release FAQs in advance of the implementation date to help companies prepare for the new rules. 

Certain experts have queried whether the legislation goes far enough in clamping down on the use of sustainability labels which fail to push users towards meaningful improvements in sustainability. The requirements relate more to the processes of the certification scheme rather than the rigour of the standards themselves, meaning that it may remain hard for consumers to differentiate between products and services that are doing “enough” and those that are “best in class”. 

Next steps 

The impact of the ECD is far-reaching. Firms exporting to or marketing in the EU must comply. Additionally, non-EU companies may also be affected if they target EU consumers. Companies must therefore act quickly to ensure that their policies and processes are up-to-date. Immediate steps for a company may include auditing existing claims and labels for their compliance with the ECD, and subsequently updating or removing non-compliant claims or labels. Similarly, engaging third-party verifiers to review claims may be a key step, and in any case maintaining records of audits, testing and verification of claims is crucial in case of inspection by regulators. Providing internal training, particularly to marketing and design teams may also be something companies consider in their compliance efforts. 

Conclusion 

It is likely that court decisions will be required to define the scope of the new rules to ensure sustainability claims are factually and legally accurate, and to guarantee consumer trust. The result will undoubtedly be fewer but more credible labels in the EU market, but whether this goes far enough is still unclear. What is clear is that there is a huge lag in businesses taking action to audit their current labels and verify that they are only using compliant labels. Affected companies must act now to ensure that they are correctly communicating environmental claims and only using certified sustainability labels.

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How Northern Europe’s long-term approach to energy, planning and balance became the industry’s quiet success story 

As power-constrained markets in Europe grapple with permitting pauses and grid restrictions, the Nordics – Denmark, Finland, Sweden, Norway and Iceland – have quietly demonstrated what sustainable growth looks like in practice. 

The lesson from the region is straightforward but profound. By aligning infrastructure planning with renewable energy capacity and public cooperation, the Nordics have created a foundation for data centre development that is both commercially and environmentally durable. 

“The Nordic markets prove that sustainability and scalability can coexist when policy, power and planning move together,” says Charlie Enright, Senior Analyst at DC Byte. “Their approach shows that growth and responsibility can be complementary rather than conflicting forces.” 

The Foundations of Sustainability

Sustainability in the Nordics is a structural feature of how the region has developed its power systems and industrial planning. The region’s advantage stems from long-term coordination between governments, utilities and local authorities, which has made clean, reliable energy available at scale.

Finland illustrates this approach well. The country’s investment in nuclear and wind generation has created one of the most stable and low-carbon power systems in Europe, with 95% of its electricity now produced from CO₂-neutral sources. This mix allows operators to expand their facility footprint, knowing the availability of clean energy sources. This benefits operators seeking scalable campuses, to service AI workloads, for example, by overcoming the power bottleneck and ensuring that expansion remains sustainable.

Across the region, sustainability works because it is embedded in the system. Power, planning and policy are aligned. This predictability has allowed operators to invest for the long term rather than chase short-term capacity gains, giving the Nordics a reputation for dependability that extends beyond their borders.

Predictable Power, Measured Growth

The stability of the Nordic energy system has allowed the region to scale its data centre capacity without the volatility seen in more constrained European hubs. Instead of racing to capture demand, operators have built steadily, guided by transparent regulation and reliable access to renewable power.

Norway’s qualified¹ supply has grown at a 43% five-year CAGR since 2019 and now exceeds one gigawatt. Finland added more than 1400 MW of total² IT load in 2023 and 2024, reflecting consistent confidence from both cloud providers and colocation developers. Sweden continues to anchor regional hyperscale growth through long-term self-build projects north and west of Stockholm, supported by power availability and strong fibre infrastructure to Northern Europe via the capital city.

This steady pace contrasts sharply with the stop-start pattern in other European markets, such as Dublin, Amsterdam and Frankfurt, where permitting pauses and grid shortages have delayed deployment of capacity. In the Nordics, predictable power translates into predictable progress. Governments and utilities coordinate closely to align new builds with available generation, preventing over-extension while maintaining room for expansion.

¹Qualified supply refers to the summation of live, under construction and committed supply.  
²Total supply refers to the summation of live, under construction, committed supply and early stage supply.  

Balance in the Ecosystem: Colocation and Scale

The Nordics’ maturity lies not just in their renewable advantage but in the balance between large-scale self-build campuses and high-connectivity urban colocation markets. While hyperscalers have expanded into unconstrained regions with abundant land and power, metro hubs such as Copenhagen, Helsinki and Stockholm continue to serve enterprise demand through dense networks of colocation facilities.

Copenhagen illustrates this dual structure. The city hosts 30 of Denmark’s 56 data centre schemes yet accounts for only 25% of the nation’s total IT load. This shows that its role is shaped by connectivity and service density rather than scale alone. Similar dynamics play out across Helsinki and Stockholm, where proximity to business users and access to renewable power sustain steady absorption.

Together, these layers form a resilient ecosystem. Hyperscale self-builds meet global capacity demand, while capital-city colocation markets keep digital infrastructure close to enterprises and communities. It is a practical balance; global scale supported by local reach, that allows the region to grow inclusively without compromising efficiency or reliability.

Lessons for the Global Industry

Grid stability and clear permitting guidelines drive investment confidence in data centres, as illustrated across the Nordics. In Norway, long-term hydropower capacity provides resilience to short-term energy shocks. Finland’s uniform power pricing allows expansion close to population centres without premium costs. Sweden’s mature self-build ecosystem has continued to expand even as earlier tax incentives have been phased out, reflecting investor trust in the market’s fundamentals.

These lessons extend beyond Northern Europe. Consistent grid policy, open collaboration between utilities and operators, and integration with community systems provide a pathway for other markets seeking to balance energy, regulation and demand. Sustainable growth does not depend on one-time incentives or isolated projects but on the alignment of planning and power.

Planning, People and Power

Renewable energy, mature grids and coordinated planning have created conditions for growth that align with future infrastructure needs. Operators expand with an eye on continuity, governments focus on power security, and communities benefit from projects designed to endure.

The Nordic markets show that sustainability and stability work best when development is built around shared objectives. Progress here is steady because it is intentional, and that focus on long-term alignment ensures the region’s continued resilience. For DC Byte, tracking these dynamics means understanding how power, planning and people come together to define the next chapter of global digital infrastructure.

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EIB Global, the international partnerships and development arm of the European Investment Bank (EIB), announced a new €1 billion financing initiative to strengthen power grid integration and clean energy across Central America, reflecting broader shifts in European-led infrastructure investment and development finance.

The financing is in line with the EU Global Gateway Investment Agenda (GGIA), extending European policy frameworks and standards beyond the EU’s internal market.

The Electricity Integration of Central America lending envelope will support the construction and upgrading of transmission and distribution infrastructure and promote renewable energy generation in Costa Rica, Panama, Honduras, Guatemala, El Salvador and Belize. The operation aims to help the region advance its energy transition and decarbonisation goals, while improving access to reliable and affordable electricity.

Catalysing sustainable growth and regional integration

Through this initiative, the EIB will act as the EU investment catalyst for Central America’s electricity integration and just transition, underlining how capital allocation and energy infrastructure are increasingly shaping global markets.

The operation is expected to include five to six sub-operations – each ranging between €150 million and €350 million – and will be implemented through framework loans and investment loans with national utilities and regional institutions.

The EIB financing will contribute to the development of the Central American Regional Electricity Market (MER), created to facilitate electricity trade and integration between Panama, Costa Rica, Nicaragua, Honduras, El Salvador and Guatemala. The project supports the countries’ commitments under their Nationally Determined Contributions (NDCs) and is expected to have a climate action contribution of around 85%.

“The European Investment Bank is the climate bank, and a key player in Latin America and the Caribbean’s energy transition. This financing will deliver cleaner energy, a better connected grid and a more secure and better quality supply for millions of people,” said EIB Group President Nadia Calviño.

“The EIB’s financial backing for the integration of Central America’s power grids clearly demonstrates the European Union’s commitment to the region for promoting our shared priorities, to the green transition and to supporting renewable energy as a key priority in cooperation between our regions,” said President of the European Council António Costa.

“This investment shows Team Europe’s commitment to just, sustainable and inclusive development in Latin America and the Caribbean. In a turbulent and polarised world, Europe chooses to work together, promoting renewable energies that will improve the lives of millions of people and protect our planet. The integration of energy systems and interconnection with grids and key components of facilitating electricity trade. Europe will bring its added value: the high social and environmental standards that are central to our image and identity,” said Executive Vice-President of the European Commission for a Clean, Just and Competitive Transition Teresa Ribera.

“Central America has enormous potential to advance a cleaner and more secure energy future. Through this initiative, the EU, under Global Gateway, is supporting a stronger and more interconnected electricity system that will ensure more reliable energy supplies and benefit communities, businesses and the environment. This investment reflects our commitment to fair and sustainable growth, and to working together as true partners for a more resilient region,” said European Commissioner for International Partnerships Jozef Síkela.

“This initiative is a clear example of how the EIB works with its partners to turn regional cooperation into real progress for people and economies. These investments in stronger power grids and renewable energy will help Central America move towards a more secure, connected and sustainable energy future,” said EIB Vice-President Ioannis Tsakiris.

Team Europe and the impact of the EU-LAC Global Gateway Investment Agenda

This operation in part of the Latin America and the Caribbean component of the EU Global Gateway Investment Agenda. It is based on the agreements reached during the 2023 CELEC-EU Summit to improve connectivity, sustainability and partnerships between the regions. It reflects the Team Europe approach, which brings together EU institutions, EU Member States, development banks and private sector partners to deliver lasting benefits for the people and economies of Latin America and the Caribbean.

Aiming to improve the reliability and interconnection of national power grids, the initiative will enable increased renewable generation capacity, cut energy losses and increase the number of users with access to a clean and stable electricity supply. It will also create opportunities for European companies to join a competitive and fast-growing energy market

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The EU has promised to cut food waste by as much as 30% by 2030, and while this is a promising step, legislation alone won’t get us there. The real challenge? Waste is still being seen as rubbish, a liability rather than a resource. 

We throw away 59.2 million tons of food every year across the continent. That’s the equivalent of €132 billion in economic losses, alongside wasted land, water and energy used to produce that food. In addition to the economic consequences, food waste also has environmental, and health consequences because of the significant methane emissions generated during decomposition. 

While overhauls in agriculture, manufacturing and consumption patterns will take time, private sector innovations can support in turning waste into a resource, closing the gap as we work towards establishing a truly circular economy.  

Europe must rethink its ‘take, make, dispose’ mindset, otherwise we risk locking ourselves into wasted potential, higher costs, higher emissions and huge pressure on our economy and daily lives.  

This is where business has a real chance to step up, even get ahead of, and complement regulation. The private sector is often called out for their role in reforming food waste systems, but they are the best positioned to show what is possible. 

Implementing circularity is the first step. And by circularity, I mean reusing everything they possibly can – especially what’s considered “waste”. 

It’s time more businesses broke out of the linear business model and prove that circularity isn’t just good practice; it’s crucial for their competitiveness and bottom line. 

Circularity is a business opportunity 

Let’s be clear: circular supply chains are all about staying competitive. Global estimates suggest that embracing a true circular economy could generate $4.5 trillion in growth by 2030.  By reusing resources, reducing extraction and cutting energy costs, businesses can strengthen supply chain resilience and unlock new revenue streams. 

For example, converting food waste into bioplastics or organic animal residues into bioenergy reduces reliance on valuable natural resources. Repurposing surplus ingredients into new products creates additional revenue lines, and using recovered energy from organic waste can lower operational costs. These approaches not only protect companies against market volatility but also drive scalable innovations that align with Europe’s long-term ambitions. 

Relying on outdated systems won’t deliver true circularity. We need new business models and technologies that redesign waste from the outset – not just try to manage it after the fact.  These technologies can help bridge the gap. 

Yet despite 55% of large businesses claiming circularity commitments, most still struggle to embed them across operations – a symptom of the persistent “linear mindset.” 

But there is no denying that there are businesses out there already proving what’s possible by turning waste into value. 

To shed some light: surplus bread has been turned into beer by Toast Brewing in the UK and Breer in Hong Kong are doing something similar with discarded loaves. Italian company Orange Fiber transforms citrus peels into textiles sold to luxury fashion houses, Kaffeeform turns used coffee grounds into durable cups, trays, and furniture. Nangli Dairy in India has launched a large-scale biogas plant that converts cow dung into compressed natural gas and compost.  

This entrepreneurship – spanning food and beverage, fashion and energy – shows that what was once dismissed as waste is in fact a powerful resource, capable of fueling entire industries and redefining competitiveness through innovation.  

The cost of inaction 

If Europe fails to fully embrace efficient technologies that support circularity, it will lose more than resources – it will also lose its competitive edge.  

Circular models aren’t a-nice-to-have – they’re becoming a baseline expectation. Investors and consumers are demanding them, and reporting requirements are increasingly mandating them. The future market is one where waste is designed from the start, and the businesses that act now will be the ones defining it. 

Europe cannot legislate its way out of waste. It must empower businesses and innovators to treat circularity as a core strategy. Those that act early will gain market share, reduce costs and strengthen resilience against supply chain shockwaves. 

Europe can’t afford to waste this opportunity 

Food waste persists, resources are tightening and emissions are climbing. The private sector has both the responsibility and the tools to turn this tide – using innovation to turn waste into value and unlock a trillion-dollar market. 

Waste is not a liability; it is the raw material of the future. Every ton left unused is a missed business opportunity. 

By Jack (Tato) Bigio‏ – ‏Co-Founder and Chief Growth and Sustainability Officer, UBQ Materials 

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