It is our pleasure to invite you to our online discussion event

Responding to the US Inflation Reduction Act
Defending EU interests and protecting key tenets of the
rules-based multilateral trade order

An online discussion with:

Erik Brattberg, Senior Vice President, Europe Practice, Albright Stonebridge Group

David Kleimann, Visiting Fellow, Bruegel

Luisa Santos, Deputy Director General, BusinessEurope

Wednesday, March 29, 2023
5:15 – 6:15 pm CET/11:15 – 12:15 pm EST

Moderator: Mark C. Fischer, Senior Project Manager, Bertelsmann Stiftung

 

Register Here 

This event continues our online event series EU Strategic Toolbox Talks. In our Toolbox Talks, we focus on existing and upcoming EU instruments aimed at managing critical dependencies and strengthening the EU’s sovereignty and external economic governance. These instruments form an important basis for fostering the EU’s capability to act in a global environment increasingly shaped by geopolitical tensions and systemic rivalries.

While the US Inflation Reduction Act (IRA) can be seen as a positive and significant step in the global fight against Climate Change, it also constitutes a significant challenge for the multilateral trading system in general, incorporating local content requirements contravening World Trade Organization (WTO) rules, and for EU competitiveness in green technologies in particular.

This development comes against a background of an increasing fracturing of the trade environment and ongoing dysfunction of central elements of the WTO at a time when transatlantic unity, in the face of the security threat by Russia and increasing geo-economic rivalry with China, is arguably more important than ever.

Following the recent meeting between President Biden and EU Commission President von der Leyen, there seems to be progress in finding a common path forward, with plans emerging for a targeted critical minerals agreement as well as the launch of a Clean Energy Incentives Dialogue to coordinate the EU and US’ respective incentive programs so that they are mutually reinforcing.

However, the details of these initiatives have yet to be worked out. Any agreement will have to negotiate the difficult balance of safeguarding a level playing field for European industries while resisting the temptation to enter a zero-sum subsidies race or emulating the US by embracing “buy European” policies.

In this discussion, we will address the following questions and topics:

  • What shape could a set of limited EU-US agreements take that would allow European producers to benefit from the incentives of the IRA? What would be a realistic timetable for the envisioned Clean Energy Incentives Dialogue? Where are potential political and regulatory pitfalls?
  • How should the EU react to the elements of the IRA that openly contravene WTO rules? Wouldn’t a bilateral agreement that tries to solve the challenges for European producers only undermine EU commitment to WTO Reform?
  • The underlying problems for European producers arising out of the IRA stem from the fact that there is no existing free trade agreement between the EU and the US. The German government has started a number of political trial balloons to explore if there is any chance for a TTIP 2.0, but there seems to be little appetite for such an idea in Washington, DC, or even Brussels. Is this idea dead in the water now that elements of a limited EU-US trade agreement to address specific challenges caused by the IRA are being discussed?

We are looking forward to your participation! 

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