Joe Biden and the president of the European Commission, Ursula von der Leyen, agreed to a truce this Friday and even laid the foundations for an agreement on the thorny issue of subsidies for the green economy. It is about the 369,000 million dollars in aid that the United States will allocate to encourage renewable energies, offset in the EU with a new framework for public injections into the sector, not unleash a transatlantic war.
Stimuli to green technologies from both sides should where possible, the Biden government indicated, be made compatible in order to “maximize the deployment of clean energy” instead of fueling “zero-sum competition that fills the pockets of interests private”.
The negotiation vehicle will be a “Clean Energy Incentives Dialogue” aimed at “coordinating our respective incentive programs so that they are mutually reinforcing,” according to the joint statement approved by the two interlocutors and their teams. Such a dialogue implies a reinforcement of mutual “transparency” regarding public aid in the US and the EU.
At the bottom is the convenience of facing Chinese competition together, although the European partners here start from a less aggressive predisposition than Washington’s due to its strong commercial ties with Beijing. Hence, in the joint communiqué, the Asian giant was only quoted between hyphens, alluding to the need to share information on anti-commercial practices “like those of China.”
Biden and Von der Leyen also decided to open negotiations on trade in “critical minerals” to allow those that are extracted or processed in Europe to be valid in the US.
The support package for the green economy approved last year in Washington through the Inflation Reduction Act provides for large credits for the purchase of electric vehicles as long as their batteries contain a high proportion of minerals from the US or from a country with which there is an agreement. It is within this framework that the EU seeks to facilitate the export to the United States of its specific minerals for said batteries. There is a lot of money and jobs at stake.
The US president and the head of the Community Executive also decided to “strengthen coordination between us and with other related partners to diversify our supply chains”: those of electric vehicles and any other products, but above all – although this was not said either – those made with components for which today there is a strong dependence on China.
Biden and Vonder Leyen pledged to achieve “an ambitious result” in the negotiations for the Global Agreement on Sustainable Steel and Aluminum by October 2023.
The pact, once the tariff war that the two blocks maintained on these materials has been overcome, seeks to “guarantee the long-term viability of our industries” in this area; “encourage the production and trade of steel and aluminum with low carbon intensity,” and “restore proper trading conditions bilaterally and globally.” In this way “we will encourage the reduction of emissions in these sectors and we will level the playing field for our workers,” they said.
