The author of the publication notes that this week the most influential politicians in Europe discussed the EU’s reaction to the “large-scale industrial and political offensive” of US President Joe Biden, writes RIA Novosti.
If hardliners, mainly France, win, there will be a threat of a “transatlantic subsidy race”, further European protectionism and a trade war with its ally. At the same time, the bloc’s interventionism will have to be financed by increasing the global debt of the European Union.
“It’s an explosive mix. France insists on a strong European response,” Kaiser warned. Even the previously unthinkable “Buy European products” rule for subsidies and government purchases is being discussed among the responses. New protectionist measures could lead to the fact that the EU is involved in a trade war with the United States, the author emphasizes.
The IRA, signed by Biden in August, will enter into force on January 1, 2023. The law provides for an investment of about 410 billion euros, of which 300 billion will go to climate protection and energy security, in particular through tax cuts for companies that invest in clean energy. Manufacturers of electric cars, batteries and renewable energy will be able to count on subsidies if production is established in the United States.
South Korean Trade Minister Dukgeun Ahn believes that the EU and Seoul should cooperate in responding to the IRA. Seoul and Brussels can work with US authorities to minimize the “discriminatory impact” of the law, he said. At the same time, the South Korean official admitted that it would be very difficult to achieve changes in the IRA in the short term.
