US President Joe Biden and EU Commission President Ursula von der Leyen have announced that they want to negotiate an “immediately” agreement on minerals for car batteries. This means that European raw materials would not have any tax disadvantages in the USA.
The European Union and the USA have taken a significant step towards each other in the trade conflict surrounding US subsidies for green technologies. US President Joe Biden and EU Commission President Ursula von der Leyen announced on Friday after a meeting in the White House that they want to negotiate an agreement on minerals for car batteries “immediately”.
Such an agreement should allow electric vehicles manufactured in Europe to be eligible for US tax credits. The background to the dispute is a US law that provides for billions in investments in climate protection and subsidies for US industry. This has raised concerns about competitive disadvantages in Germany and the EU. The problem from a German and European perspective with the so-called Inflation Reduction Act (IRA): Many subsidies and tax credits are linked to the fact that profiting companies use US products or produce them themselves in the USA.
The aim now is to conclude agreements for the area of critical minerals with Brussels. The term free trade agreement is not defined in the US climate law. In the joint communication from the EU Commission and the White House, there is now talk of a “targeted agreement”. After the meeting, Von der Leyen emphasized that it was agreed to work on ensuring that critical raw materials extracted in the EU would have the same access to the American market as if they had been extracted on the American market.