popular articles

US subsidies: Europe raises its voice against US protectionism

Several European leaders have raised their voices against the massive subsidies given by the United States to companies on their soil.

Please share:

A new trade dispute is brewing over the Atlantic: several European leaders raised their voices on Monday against the massive subsidies granted by the United States to companies on their soil, threatening to sue at the WTO.

At the origin of the rising tensions between the two great Western powers, the implementation this summer of the “Inflation Reduction Act”, the largest investment ever decided in the fight against climate change, providing 370 billion dollars for the construction of wind turbines, solar panels and electric vehicles.

One measure is the focus of criticism: a tax credit of up to $7,500 for the purchase of an electric vehicle from a North American factory with a locally manufactured battery, thus excluding cars produced in the EU.

This plan is a source of irritation for Europe, which accuses it of organizing exceptional subsidies for companies producing on American soil, which it says is totally contrary to the rules of international trade.

One after another, several of its leaders came to the fore again on Monday after weeks of criticism, even threatening legal action.

“We will obviously consider retaliatory measures,” said Thierry Breton, European Commissioner for the Internal Market, during an interview on BFM Business, raising the possibility of going “before the WTO” to make the European arguments if Washington remains deaf to the EU’s recriminations.

A joint “working group” between the EU and the United States will initially attempt to address European concerns.

In recent weeks, the risk of a “trade war” between the two allied regions has been mentioned in no uncertain terms.

French Economy Minister Bruno Le Maire used the term during a visit to Berlin in October, while calling for it to be avoided, and German Chancellor Olaf Scholz spoke of the risk of a “huge tariff war.

Other trade disputes

The trade war is not new to relations between the United States and the European Union, which have had to settle several disputes in recent years.

Among them, the face-off between the European aeronautics giant Airbus and the American Boeing, again against a backdrop of subsidies, and the imposition of additional tariffs by the Trump administration on steel and aluminum.

“The historical irritants are barely appeased that Washington adopts very offensive measures,” commented to AFP Elvire Fabry, expert in geopolitics of trade at the European Institute Jacques Delors.

Politically, however, the latter sees the Biden administration’s measures more as “a domestic agenda to protect U.S. interests” than as a “declared tariff war” as under the Trump era.

In any case, “there is no time to lose for the Europeans, we are a little more than three months after their implementation and there have been no encouraging signals of commitment from the United States beyond friendly explanations,” according to her.

The subject is of even greater concern to European states as the recession threatens to hit the continent next year due to the economic consequences of the war in Ukraine. Energy prices are soaring, making many companies vulnerable.

“The amount of subsidies that the Biden administration is proposing is four to ten times the maximum amount allowed by the European Commission” in some cases, criticized Bruno Le Maire on Monday, who called in an interview given to several European newspapers for a “coordinated, united and strong” response.

According to him, “10 billion investments and thousands of industrial jobs” are at stake.

Register free of charge for uninterrupted access.

Publicite

Recently published in

The French government activates five funding mechanisms to support industrial decarbonisation projects through the France 2030 plan, targeting major sites, SMEs and high-emission industrial zones.
Paris releases a new €400mn funding package to support industrial projects aimed at reducing emissions under the France 2030 programme.
Paris releases a new €400mn funding package to support industrial projects aimed at reducing emissions under the France 2030 programme.
The massive withdrawal of American financial support and the reduction of European aid could jeopardize energy projects in Africa, profoundly altering their financing structure and the continent's commitments.
The massive withdrawal of American financial support and the reduction of European aid could jeopardize energy projects in Africa, profoundly altering their financing structure and the continent's commitments.
The Vietnamese government has raised its renewable energy targets in a new version of its national energy plan, responding to continued growth in electricity demand.
The Vietnamese government has raised its renewable energy targets in a new version of its national energy plan, responding to continued growth in electricity demand.
A massive outage plunged Puerto Rico into darkness on Wednesday, leaving approximately 1.1 million households without electricity after an unexpected shutdown of all its power plants.
The Czech Republic has ended its dependency on Russian oil after more than six decades, a major shift made in response to Russia's invasion of Ukraine.
The Czech Republic has ended its dependency on Russian oil after more than six decades, a major shift made in response to Russia's invasion of Ukraine.
The European power purchase agreement (PPA) market for renewables reached 19 GW of new capacity in 2024, with growing momentum for hybrid contracts including storage.
The European power purchase agreement (PPA) market for renewables reached 19 GW of new capacity in 2024, with growing momentum for hybrid contracts including storage.
Industry Minister Marc Ferracci criticised the Rassemblement National's stance on energy, accusing it of hindering planned investments in renewables in favour of fossil fuel imports.
Industry Minister Marc Ferracci criticised the Rassemblement National's stance on energy, accusing it of hindering planned investments in renewables in favour of fossil fuel imports.
Bill 69 sparks protests in Saint-Jean-sur-Richelieu, where several organisations denounce a risk of privatising Quebec’s electricity sector.
Wind and solar energy accounted for nearly one-fifth of Türkiye’s electricity generation in 2024, according to an analysis by think tank Ember, driven by a strong increase in installed capacity.
Wind and solar energy accounted for nearly one-fifth of Türkiye’s electricity generation in 2024, according to an analysis by think tank Ember, driven by a strong increase in installed capacity.
The Acerez consortium has signed a 35-year agreement to build and operate over 240 km of high-voltage lines in Australia, marking the country's first public-private partnership in the sector.
The Acerez consortium has signed a 35-year agreement to build and operate over 240 km of high-voltage lines in Australia, marking the country's first public-private partnership in the sector.
France’s multi-year energy strategy shifts focus away from photovoltaics toward flexibility measures, including battery storage, to address growing imbalances in the electricity market.
France’s multi-year energy strategy shifts focus away from photovoltaics toward flexibility measures, including battery storage, to address growing imbalances in the electricity market.
France’s energy regulator unveils its first observatory dedicated to renewable electricity purchase agreements, highlighting a recent but still marginal growth compared to State-backed mechanisms.
The French government plans to adopt within two weeks a decree outlining the decade’s energy objectives, restarting nuclear power and preparing for a parliamentary debate on energy sovereignty.
The French government plans to adopt within two weeks a decree outlining the decade’s energy objectives, restarting nuclear power and preparing for a parliamentary debate on energy sovereignty.
The expansion of solar and wind capacity is multiplying hours of negative prices on European electricity markets, weakening the sector's economic balance while reshaping export and storage dynamics.
The expansion of solar and wind capacity is multiplying hours of negative prices on European electricity markets, weakening the sector's economic balance while reshaping export and storage dynamics.
The National Assembly will discuss national energy security on 28 April at the government’s request, in connection with the upcoming Multiannual Energy Programming covering the 2025-2035 period.
The National Assembly will discuss national energy security on 28 April at the government’s request, in connection with the upcoming Multiannual Energy Programming covering the 2025-2035 period.
Despite a predominantly decarbonised electricity production, demand in Europe remains subdued, hindered by uncompetitive prices and limited industrial usage.
Data from think tank Ember reveals that fossil fuels accounted for just 49.2% of US electricity generation in March 2025, marking an unprecedented threshold.
Data from think tank Ember reveals that fossil fuels accounted for just 49.2% of US electricity generation in March 2025, marking an unprecedented threshold.
The global electricity mix shifted in 2024 with 40.9% of production from low-carbon sources, according to Ember, driven by historic solar power growth.
The global electricity mix shifted in 2024 with 40.9% of production from low-carbon sources, according to Ember, driven by historic solar power growth.
Facing recurring shortages, Tajikistan tightens energy laws by introducing prison sentences of up to ten years for electricity fraud to protect its ageing hydropower network.
Facing recurring shortages, Tajikistan tightens energy laws by introducing prison sentences of up to ten years for electricity fraud to protect its ageing hydropower network.
Burundi’s main opposition coalition warns of direct consequences from the energy crisis on the organisation of the June legislative elections.
In Cienfuegos, Cuba is deploying an ambitious photovoltaic programme supported by China to reduce its dependence on oil and stabilise its failing power grid.
In Cienfuegos, Cuba is deploying an ambitious photovoltaic programme supported by China to reduce its dependence on oil and stabilise its failing power grid.
The Panama Canal Authority has approved a strategic gas pipeline project amid political tensions and diverging interests over regional energy control.
The Panama Canal Authority has approved a strategic gas pipeline project amid political tensions and diverging interests over regional energy control.
The European Investment Bank is funding a €732 mn expansion plan to modernise and stabilise the electricity network in the Ostsachsen region by 2027.
The European Investment Bank is funding a €732 mn expansion plan to modernise and stabilise the electricity network in the Ostsachsen region by 2027.

Advertising