Biden and Macron to Hold White House Summit on the 1st of Next Month... Inflation Reduction Act a 'Hot Potato'

Macron to Visit the US for Three Days Starting Tomorrow... First State Guest Invitation Since Biden's Inauguration
Dinner Meeting at the White House on the 1st of Next Month... Seeking Solutions to Ease European Investment Contraction

On the 15th (local time), at the opening ceremony of the G20 summit held in Bali, Indonesia, U.S. President Joe Biden (right) and French President Emmanuel Macron (center) met and shook hands. On the left is German Chancellor Olaf Scholz.
Photo by Reuters Yonhap News

[Asia Economy Reporter Park Byung-hee] The Inflation Reduction Act (IRA), which has been a subject of controversy, is expected to be one of the main agenda items at the summit between U.S. President Joe Biden and French President Emmanuel Macron on the 1st of next month (local time).

According to major foreign media on the 28th, President Macron will make a three-day state visit to the United States starting on the 30th. President Macron is scheduled to have a dinner meeting with President Biden at the White House on the 1st of next month. This is the first time President Biden has invited a French president since taking office. President Macron is visiting the U.S. for the second time since taking office, following his visit in 2018 during Donald Trump's administration.

Foreign media reported that President Macron will ask President Biden to take into greater consideration the significant damage Europe has suffered due to the Ukraine war in the policy-making process. This is interpreted as a request for greater understanding of Europe's position regarding the implementation of the U.S. IRA.

Bruno Le Maire, France's Minister of Economy and Finance, who will accompany President Macron on his visit to the U.S., also expressed concerns about the IRA during a virtual meeting with Katherine Tai, U.S. Trade Representative (USTR), on the same day. The USTR issued an official statement saying, "Representative Tai and Minister Le Maire agreed that both the U.S. and the European Union (EU) need to cooperate closely to deeply understand the IRA."

The IRA is a bill in which the U.S. government provides $369 billion in support for electric vehicles and eco-friendly energy sectors produced in North America. The EU has expressed concerns that since the support is premised on production in North America, it could dampen European investment.

President Macron recently stated that the U.S. IRA does not comply with World Trade Organization (WTO) regulations and is not friendly, and that he will discuss this issue during his visit to the U.S. It is reported that last month, President Macron met with German Chancellor Olaf Scholz and agreed that if the unfair competition elements, such as subsidies only for electric vehicles produced within the U.S., are not resolved, the EU should also take corresponding measures.

John Kirby, spokesperson for the White House National Security Council (NSC), said that President Biden will discuss France's concerns during the meeting with President Macron. Referring to the task force (TF) formed to discuss the IRA electric vehicle discrimination issue between the U.S. and the EU, Kirby said, "We hope to have dialogue about the IRA and seek ways to address concerns."

In addition to the IRA, Presidents Biden and Macron are expected to discuss ways to reduce economic damage caused by the Ukraine war and cooperation measures to counter China.

Meanwhile, foreign media reported that this state visit by Macron, arranged at Biden's invitation, is part of efforts to resolve conflicts arising from the launch of the security alliance AUKUS between the U.S., the U.K., and Australia last year. With the launch of AUKUS, Australia agreed to receive nuclear-powered submarine technology support from the U.S. and the U.K., both nuclear-armed countries. Consequently, Australia canceled a contract to supply 12 diesel submarines with France, which caused strong displeasure from France toward the three AUKUS member countries at the time.