US, EU officials meet amid climate plan tensions

US and European Union officials kicked off talks on trade and technology Monday, amid heightened tensions over American subsidies for its green industry that Europe sees as anti-competitive.

The third ministerial meetings of the US-EU Trade and Technology Council in Maryland will touch on issues such as fallout from Russia’s invasion of Ukraine and questions over economic coercion, but all eyes are on Washington’s landmark Inflation Reduction Act (IRA).

The act, designed to accelerate the US transition to a low-carbon economy, contains around $370 billion in subsidies for green energy, as well as tax cuts for US-made electric cars and batteries.

EU countries have poured criticism on the IRA, seeing it as a threat to European jobs, especially in the energy and auto sectors.

Monday’s talks are part of a push “to grow the bilateral trade and investment relationship,” according to a National Security Council statement.

It added that the United States is “committed” to understanding EU concerns on the IRA.

But EU Internal Market Commissioner Thierry Breton has decided not to take part in the meetings, his office said, finding that they no longer give enough space to issues of concern to many European industry ministers and businesses.

Last month, Breton threatened to appeal to the World Trade Organization and consider “retaliatory measures” if the United States did not reverse its subsidies.

The plan was also a subject of discussions between US President Joe Biden and his French counterpart Emmanuel Macron at a state visit last week.

Biden said both sides have agreed to discuss practical steps to coordinate and align their approaches, though he added that he would not apologize for the act, which was never intended to disadvantage US allies.

The Trade and Technology Council is co-chaired by the United States’ Secretary of State Antony Blinken, Secretary of Commerce Gina Raimondo and Trade Representative Katherine Tai, as well as European Commission Executive Vice Presidents Margrethe Vestager and Valdis Dombrovskis.