Overview of Government Measures to Support Industry Amid War-Era Pressures
The Cabinet of Ministers has approved a royal decree aimed at mitigating the economic and social impacts of the war in Ukraine. The decree extends the contract for assistance in the manufacturing sector through December 31, 2023, a move widely used by key industries. In Asturias, prominent companies such as ArcelorMittal are among the beneficiaries. (Source: Ministry of Industry)
According to officials, maintaining this level of contracting is crucial in the current economic climate characterized by the Ukraine conflict and high energy costs. The aim is to protect the industrial base, save jobs, and prevent workforce reductions across the sector. The ministries involved emphasize that continuing these contracts helps sustain regional industrial activity and stability for workers and the broader economy. (Source: Ministry of Industry)
The benefits linked to these agreements enable older workers to transition out of the workforce while opening opportunities for younger generations to enter the labor market. This approach supports a necessary generational shift within the industry. The existing partial pension mechanism, paired with the termination of a corresponding benefit contract, remains in force. This arrangement predates Law No. 27/2011, dated August 1, which updated and reformed security systems. Social provisions tied to pensions received before January 1, 2024, continue to apply as part of the transition plan. (Source: Ministry of Industry)
In addition, the government has approved the launch of a strategic initiative for industry decarbonization (PERTE), financed with European support through the Recovery Plan. This program is designed to accelerate low-emission technologies and practices within the sector and is backed by a substantial funding envelope. (Source: Ministry of Industry)
A $450 million support line for gas-intensive companies has also been established to offset the impact of a sharp rise in natural gas prices. Aid will be allocated across eligible activities by considering gas consumption intensity, evolving energy prices, profitability, and environmental impact. The support targets sectors such as ceramics, tiles, paper, glass, iron and steel, aluminum, synthetic fibers, and both natural and synthetic fiber production, among others. (Source: Ministry of Industry)
To reinforce this assistance, the Cabinet approved a separate 500 million euro line under the ICO-Ukraine program, intended to bolster private-public support for financing in the gas-intensive segment. This funding aims to cushion the sector most affected by energy cost hikes. Production in several high-gas-use industries has contracted notably; for instance, the man-made and synthetic fiber sectors and basic iron and steel product manufacturing have experienced substantial declines in October 2022 compared with the previous year. Ceramic production has also seen a noticeable drop. (Source: Ministry of Industry)