FR-US Finance Ministers Discuss EU Electric Vehicle Subsidy Benefits

[Image source=EPA Yonhap News]

[Asia Economy Reporter Yujin Cho] Bruno Le Maire, France's Minister of Economy and Finance, announced that he has begun discussions with Janet Yellen, the U.S. Secretary of the Treasury, on whether European Union (EU) products, including electric vehicle batteries, can benefit from the Inflation Reduction Act (IRA).

Minister Le Maire stated in an interview with France Inter Radio on the 5th (local time) that they plan to explore expanding the benefits from electric vehicle batteries to all other eco-friendly products. This move follows up on French President Emmanuel Macron's visit to the U.S. last week, during which he raised the issue of adjusting the Inflation Reduction Act with President Joe Biden.

Ahead of the summit with President Biden, President Macron expressed strong dissatisfaction regarding the impact of the Inflation Reduction Act on French companies during a working lunch with U.S. lawmakers in Washington D.C. Seemingly in response, President Biden acknowledged at a joint press conference held after his meeting with President Macron the following day that the Inflation Reduction Act has "small flaws" and hinted at possible adjustments.

Subsequently, President Macron mentioned in media interviews that he and President Biden agreed to resolve the disputes caused by the Inflation Reduction Act and aim to finalize the matter within the first quarter of next year. Minister Le Maire, who accompanied President Macron to the U.S., also coordinated the next steps with Robert Habeck, Germany's Vice Chancellor and Minister for Economic Affairs and Climate Action, over the past weekend. While the Inflation Reduction Act primarily focuses on large-scale investments to reduce greenhouse gas emissions as part of climate change efforts, it includes provisions granting up to $7,500 (approximately 10 million KRW) in subsidies exclusively for North American-made electric vehicles, sparking controversy over discrimination against Korea and Europe.