Jozef Sikela, the Czech Minister of Industry, on October 17, 2022 in Prague (AFP/Archives/Michal Cizek)
The gigantic American investment plan on climate transition, which establishes “discriminatory” measures for European car manufacturers, is “unacceptable” for the Twenty-Seven, estimated Monday the Czech Minister of Industry, whose country occupies the rotating presidency of the EU.
“I will be direct: it is unacceptable for the EU. As it stands, this text is extremely protectionist, to the detriment of European exports. This point must be clarified”, underlined Jozef Sikela, on the sidelines of a meeting European Trade Ministers in Prague, where US Trade Ambassador Katherine Tai was invited.
However, the EU is currently ruling out any action before the World Trade Organization (WTO): “At this stage, we are concentrating on a negotiated solution before considering other options”, declared the European Commissioner to the Commerce Valdis Dombrovskis after the meeting.
Ratified this summer, the “Inflation Reduction Act” set up by Joe Biden appears to be the biggest investment ever decided in the fight against climate change. It provides 370 billion dollars for the construction of wind turbines, solar panels and electric vehicles.
US Trade Representative Katherine Tai (d) and EU Trade Commissioner Valdis Dombrovskis in Washington on October 13, 2022 (AFP/Archives/Jim WATSON)
One measure in particular ruffles Europeans: a tax credit, up to $7,500, reserved for the acquisition of an electric vehicle coming out of a North American factory with a locally manufactured battery – thus excluding cars produced in the EU.
“Many of the + green + subsidies provided for in the text may discriminate against European companies in the fields of automobiles, batteries, renewable energies and energy-intensive industries”, insisted Monday Valdis Dombrovskis.
He announced that a joint “working group” between the EU and the United States would hold its first meeting this week to try to address the concerns of Europeans: “It will not be easy to solve, but we have to get there “, he said to the press.
“We know that other countries, such as Japan and South Korea, share the EU’s concerns, and are also considering how best to approach this issue,” he added.
For the Twenty-Seven, “the objective would be to obtain the same status as Canada and Mexico”, whose production benefits from the same advantages as that of the United States in the measures adopted, specified Mr. Sikela, noting that it was “a starting position in the negotiations”.
The Czech official said he was “quite optimistic” after Katherine Tai’s meeting with EU ministers in Prague: “There is good will on both sides,” he said.
Germany, home to auto giants Volkswagen, BMW and Mercedes, warned three weeks ago of the risk of a transatlantic “tariff war”.
“It is very important that we cooperate closely as strategic allies, particularly in the current situation”, between the war in Ukraine and the energy crisis, insisted Jozef Sikela, pointing out that Europe must deepen its ties with “reliable partners who share its values” to get rid of its dependence “on unpredictable authoritarian regimes”.
Brussels and Washington have had several major disputes before the WTO in recent years, in particular over aid to the American aircraft manufacturer Boeing and American customs duties on European steel.
© 2022 AFP
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