In a speech at the College of Europe in Bruges, Belgium, von der Leyen stated that the European Union must “take steps to equalise the playing field if the IRA (Inflation Reduction Act) or other policies create distortions.”
According to the head of the EU, the $430 billion (£349 billion) US programme to reward environmentally friendly technologies has caused “distortions” that must be addressed. The US Inflation Reduction Act (IRA) has drawn criticism from several EU members, sparking worries of a trade war. There are worries that tax advantages could entice foreign firms and hurt European firms.
Ursula von der Leyen, president of the European Commission, suggested that the EU “modify our own laws.”
In a speech, she stated, “Competition is excellent, but this competition must respect a level playing field.”
The IRA will provide financial incentives for American consumers to buy both new and used electric vehicles, heat pumps to heat their houses, and even electric induction cookware.
She added that Brussels must “modify” its own regulations in order to encourage government funding of the environmental transition and “re-evaluate the necessity for additional European funding of the transition.”
Emmanuel Macron, the president of France, used a state visit to Washington this week to meet with US Vice President Joe Biden and vent his grave concerns about US-EU trade.
The IRA is praised by the White House as an innovative initiative to revive the US industry and advance renewable technologies.
