This should reassure the European Union. The latter has constantly alerted the United States to the consequences of President Biden’s vast climate plan (IRA) which was voted on last year. It provides for a set of subsidies – an envelope of 430 billion dollars – to support the sales of American electric cars. In October 2022, the head of French diplomacy, Catherine Colonna, was indeed worried that France and the United States were no longer “on an equal footing” with this plan. Emmanuel Macron then warned about these subsidies qualified as “super aggressive” on the commercial level, ensuring however that it ” share[air] goals “. The President had felt that the IRA risked “Fragmenting the West”.
But, on Friday, a change in the conditions for allocating subsidies was integrated allowing the latter, in the amount of 7,500 euros, to be allocated to American motorists even if they buy an electric car partly produced abroad. Initially, the plan, won with great struggle, in particular after tough negotiations with the Democratic senator of West Virginia (east) Joe Manchin, provided, in fact, that a preponderant part of the vehicle and the battery had to come from South America. North. But the conditions published by the Treasury Department, which will come into force in April, finally open up the source of both vehicles and critical materials necessary for the batteries or the batteries themselves.
Critical materials agreements included
More specifically, these conditions, put out for consultation before final validation, concern, beyond the United States, the States bound by a free trade agreement. “A term that includes recently negotiated agreements relating to critical materials”, the Treasury said in a statement. In total, 21 countries are concerned, including Japan, which signed an agreement on Monday concerning precisely “supply chains for critical minerals and batteries for electric vehicles”. If not yet on the list, the EU hopes to quickly sign a similar deal, with negotiations officially kicking off during European Commission President Ursula von der Leyen’s visit to Washington on March 10.
An evolution in the American discourse which was welcomed by the European Commissioner, Margrethe Vestager, currently in the American capital. Asked by AFP, the European Commission estimated on Friday that “the conditions confirmed the pragmatic approach chosen” and said focus now on “quickly finalize an agreement on critical minerals in order to [s’]ensure that the EU was treated in the same way as other close partners” the United States. The day before, she had reminded the press that he was “difficult to fight against global warming if we did not have zero carbon industry everywhere” and not just in the United States. “What we are trying to avoid is that the acceleration that we want to give in Europe is not potentially stopped by that which the United States wants to experience”she insisted.
Chinese companies seen as “suspicious entities”
On the other hand, the conditions for allocating the subsidies clearly specify that they exclude, as provided for when the law was passed, “suspicious entities”. By this term, the United States refers in particular to Chinese companies. ” Given China’s dominant position in the clean energy value chain, we need to work with our allies and partners to build a strong supply chain that can meet the expectations of the American consumer. “, underlined a Treasury official, during a telephone exchange. The idea is in line with the position defended by the European Commission, which has called for this approach to be broadened beyond the G7 countries and towards countries producing critical materials, which currently export mainly to China. Among these materials are nickel or cobalt, which are used in the manufacture of batteries.
However, this broadening of the conditions does not satisfy everyone, starting with Senator Manchin who did not hide his anger. He estimated Friday, in a press release, that they “were totally unaware of the IRA’s objective”was ” to bring industries back to the United States and [leurs] ensure we have safe and strong supply chains”. « American public money should not be used to support industrial jobs abroad. The consultation period is open and I invite every American to speak. My advice is simple: stop it, respect the law “, he added.
(With AFP)
