Our analysis shows that the most exposed industries are chemicals, basic metals, non-metallic mineral products, pulp and paper products, wood and wood products and refining. The production of basic metals, chemicals and non-metallic mineral products is particularly vulnerable to fluctuations in natural gas prices, while that of basic and non-ferrous metals is at relatively greater risk from higher electricity prices. Compared with their counterparts in France, Germany and the Netherlands, Belgian EIIs appear more sensitive to energy price shocks, which could worsen competitiveness in the medium term.
The weight of EIIs in the Belgian economy has been steadily declining, reflecting a broader shift in industrialised economies from manufacturing to services. Regarding the economy's degree of exposure to EIIs, the share of expenditure on EII-produced intermediate inputs is only around 9%. Currently, EIIs account for roughly 3% of total employment and 4% of value added. The Flemish Region has the highest number of EII jobs in absolute terms, representing 75% of Belgian EII employment. Overall, a potential negative shock to EIIs could directly affect up to 130 000 jobs.
Energy cost competitiveness is a key concern for Belgian EIIs. The structural gap in the industrial electricity and natural gas prices between the EU and the US has increased significantly, putting EU EIIs at a disadvantage in domestic and international markets. In addition, energy cost differentials within the EU can be partly traced back to national government interventions, with taxes contributing to roughly 5% of the 2024 electricity price. In 2024, large industrial energy consumers in Belgium faced electricity prices in line with those of neighbouring countries, but lower natural gas prices. In 2025, transmission rates for large electricity consumers doubled compared with their 2024 level, putting the competitiveness of Belgian EIIs under pressure. The EU Emissions Trading System (EU ETS) results in higher energy costs for EIIs, both directly through the required purchase of carbon allowances and indirectly through higher electricity prices linked to fossil fuel-based power generation.
The Carbon Border Adjustment Mechanism (CBAM) aims to create a level playing field in Europe by imposing on specific imports the same carbon price that domestic firms face when producing those goods. Among the limitations of CBAM, no measure is adopted to reduce the distortionary impact of carbon pricing on EU exporters active in non-EU markets. The most affected industries are basic metals, non-metallic mineral products and chemicals due to their greater reliance on intermediate inputs covered by CBAM. Nonetheless, our estimates suggest that the additional cost of imported materials arising from the introduction of CBAM will remain below 2% of value added, even in the event of a threefold increase in the carbon price, concurrently, CBAM will allow to sustain higher selling prices in the EU market.
Addressing these challenges requires coordinated efforts by policymakers, industry leaders and stakeholders. A coherent European and national approach could play a critical role in aligning private incentives and in fostering investment in low-carbon production processes while ensuring economic viability. Moreover, a stable and resilient energy system will be essential to provide green and affordable energy to reconcile long-term sustainability with competitiveness of Belgian and European EIIs in an increasingly competitive global market. This analysis was completed prior to the announcement of major new tariffs affecting exports to the United States, which will likely increase the competitiveness challenges facing Belgian EIIs.