© Reuters. FILE PHOTO: French Economy and Finance Minister Bruno Le Maire speaks during a joint press conference with German Economy and Climate Minister Robert Habeck (not seen) at the Bercy Ministry in Paris, France , on February 7, 2022. REUTERS/Sarah Meyssonnier/
By Christian Kraemer and David Lawder
WASHINGTON (Reuters) – French and German finance ministers found willingness in Washington to address Europe’s concerns about green technology subsidies under the US Cut Inflation Act, but came up with few details of meetings with senior officials there.
European capital is concerned that the law, designed to shield US companies from the impact of price increases and subsidize investment in new green technologies, will undermine the competitiveness of their companies in the gigantic North American market.
German Finance Minister Robert Habeck and his French counterpart Bruno Le Maire said after a meeting with US Treasury Secretary Janet Yellen that they agreed there had to be transparency on targeted subsidies so the European Union could match them. if necessary.
“It’s a process, and in a process you go step by step,” Le Maire told reporters. Earlier, Habeck said there was no rush to reach a solution on the issue of access to key raw materials.
The symbolic trip of the duo in charge of Europe’s two largest economies was designed to highlight the importance of the issue, Habeck added.
At stake is Europe’s competitiveness in future industries such as electric vehicles and battery manufacturing, along with access to the raw materials that make them up.
After meetings with Yellen, Commerce Secretary Gina Raimondo and White House officials, Habeck and Le Maire emerged with few details other than promises to be clear about their competing green subsidies.
While Canadian and Mexican companies can benefit from many of its provisions, the law does not help European competitors.
Noting the agreement of both parties on the need for transparency in subsidies, Habeck said: “(We will create) a technical group to make this transparency work.”
“You can’t have fair competition if you don’t have full transparency about the level of public subsidies and public tax credits that are given to private companies,” Le Maire added.
Among the achievements of the meeting, Habeck listed a commitment for the US and EU Trade and Technology Council (TTC) to develop common standards for green products and an agreement to explore creating a “critical minerals” club. “to help both sides of the Atlantic reduce dependence on China for battery minerals.
RESPONSES FROM THE UNITED STATES
The readings from US officials were less specific on the results and signaled no major concessions. The US Treasury said Yellen discussed US and European clean energy subsidy plans, “emphasizing the need to stimulate innovation and technology development and deployment on both sides of the Atlantic” to meet climate goals.
The Commerce Department said Raimondo noted in the meetings that “the IRA is a key tool for the United States and is the most important US climate legislation to date.” But Commerce said it applauded the TTC’s work to promote transparency of US and EU semiconductor subsidies and support supply chains.
Some US lawmakers say opening up the law’s tax credits to European rivals would lessen the competitive advantages they would give US companies and limit US investment.