EU Urged to Find a Solution Within the Year
[Asia Economy Reporter Yujin Cho] On the 5th (local time), the European Union (EU) urged a resolution within the year to the issue of subsidy discrimination against EU-made electric vehicles under the United States' Inflation Reduction Act (IRA), according to major foreign media reports.
According to reports, during the task force (TF) level discussions between the US and the EU on the discrimination issue in the Inflation Reduction Act, both sides evaluated that there was a "preliminary progress."
Following the Trade and Technology Council (TTC) meeting held at the University of Maryland in Maryland, the US and the EU stated in a joint statement, "We acknowledge the EU's concerns and emphasize our commitment to constructively resolve this issue."
US Secretary of State Antony Blinken said at a joint press conference, "As you have heard, President Joe Biden has strengthened his commitment to work together to address these concerns," adding, "We are doing this efficiently, and I believe we advanced the discussion today." He continued, "Today, we discussed electric vehicle tax credits, commercial vehicle tax credits, critical minerals, and supply chains," and said, "As President Joe Biden stated, we expect to maintain momentum in discussions to resolve the differences."
Before the meeting, Valdis Dombrovskis, the EU Executive Vice President in charge of trade, said, "The Inflation Reduction Act will hinder progress made between the US and Europe," adding, "More work beyond the TF discussions will be necessary."
The TTC between the US and the EU was established to promote trade and investment between the two sides and strengthen technological cooperation. Launched in September last year, the TTC also serves as a joint response to China's unfair trade practices. However, at this meeting, the main issue addressed was the unfair competition problem caused by subsidy discrimination against electric vehicles under the US Inflation Reduction Act. The US and the EU also launched a separate TF in October to discuss the electric vehicle subsidy discrimination issue.
At the 3rd TTC meeting, the US side was represented by Secretary of State Antony Blinken, Secretary of Commerce Gina Raimondo, and USTR Representative Katherine Tai, while the EU side included Valdis Dombrovskis, EU Executive Vice President, and Margrethe Vestager, EU Executive Vice President.
Meanwhile, Bruno Le Maire, French Minister of Economy and Finance, began discussions with US Treasury Secretary Janet Yellen on whether EU-made products such as electric vehicle batteries can benefit from the Inflation Reduction Act. This is a follow-up measure taken after French President Emmanuel Macron raised the issue of adjusting the Inflation Reduction Act with President Joe Biden during his visit to the US last week.
Before 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 US lawmakers in Washington DC. Seemingly aware of this, President Biden acknowledged at a joint press conference held after his meeting with President Macron the next day that the Inflation Reduction Act has "small flaws" and hinted at adjustments.
President Macron later stated in media interviews that he and President Biden agreed to resolve the disputes caused by the Inflation Reduction Act and expressed a desire to conclude the matter within the first quarter of next year. Minister Le Maire, who accompanied President Macron to the US, said he coordinated the next response measures with Robert Habeck, German Vice Chancellor and Minister for Economic Affairs and Climate Action, over the past weekend.
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