The commissioner said he was “working hard to find something that can compare” to the American plan. These proposals will be presented “very quickly,” he insisted. Brussels has been worried for several months about the effects of the Inflation Reduction Act (IRA), a 420 billion dollar plan by US President Joe Biden dedicated largely to the climate and adopted last summer.
Corporate flight?
This plan provides, among other things, for reforms and concessions in favor of companies established in the United States, in particular in the sector of electric vehicles or renewable energies. The European Union is calling for more “coordination” and fears that its companies will flee to the other side of the Atlantic. “Every day I am told examples” of companies that have given up on “investing in Europe,” Thierry Breton admitted on Tuesday. One of the major tension points, he says, is the grant of up to $7,500 given for the purchase of an electric vehicle made in the United States, Canada or Mexico.
“This will create an unacceptable” trade barrier” and contrary to “WTO rules”, judged Thierry Breton, recalling that discussions were underway with Washington on this issue. In detail, the EU’s response to IRA will consist of “three parts”, specified Thierry Breton. A regulatory component, intended to accelerate the growth of European “green tech” (green economy); a financial component, so that all Member States have access to the resources needed to support this sector; and the creation of a “sovereign wealth fund” capable of investing in European industrial projects.
