WASHINGTON: President Joe Biden and top EU official Ursula von der Leyen have declared progress in defusing a transatlantic trade dispute Friday, as they reaffirmed their support for Ukraine in its fight against Russia.
After Oval Office talks, the two leaders announced that negotiations will begin to give EU producers of critical minerals access to the US market under Biden’s signature program to encourage climate-friendly industries.
They also agreed to work together more broadly as the economies of the United States and the European Union shift to the burgeoning electric vehicle and other green sectors. President of the European Union Commission, Von der Leyen has collaborated closely with Biden in putting together an unprecedented response to the invasion of Ukraine by Russia over the last year. Biden told von der Leyen that the alliance to support Ukraine signaled the start of a “new era.”
And in their joint statement later, they stated “Russian President Vladimir Putin “thought that he would divide us, and yet we’re more united than ever. We will continue to stand united in our unconditional support for Ukraine for as long as it takes.” However, the Biden administration’s landmark Inflation Reduction Act (IRA), a government spending spree championing US manufacturing in climate-friendly technologies, is causing consternation in Europe.
Concerned that the subsidies’ “made in America” requirement will harm European-based energy and auto sectors, the EU is developing its own sets of incentives to promote the emerging sector, such as the Green Deal Industrial Plan. According to the joint statement, Biden and von der Leyen reached an agreement to begin talks on an exemption for European producers trying to seek to export critical minerals for electric vehicle batteries.
Von der Leyen after meeting Biden told reporters that today we agreed that we will work on critical raw materials that have been sourced or processed in the European Union (EU) and to give them access to the American market as if they were sourced in the American market. She stated that we will work together to reach an agreement.
Their statement said more broadly that “both sides will take steps to avoid any disruptions in transatlantic trade and investment flows that could arise from their respective incentives. The statement further said that we are working against the zero-sum competition to maximize clean energy deployment and job creation.”
Another difficult issue is determining how to respond to China’s increasingly assertive foreign and trade policies. As per the White House, “challenges posed by the People’s Republic of China” were prominently discussed during the talks. Washington has urged European capitals to take a stronger stance against Beijing, not only diplomatically, but also economically. However, the EU is keen to avoid a rift with China, leaving the transatlantic allies divided on how to proceed.
EU to work with Washington
Elvire Fabry, an analyst at the Paris-based Institut Jacques Delors, told AFP that the White House meeting was an opportunity for von der Leyen to demonstrate the desire of EU to work with Washington “but not as a follower, especially when it comes to China.”
However, the US official emphasized the shared perspective of Brussels and Washington on the China challenge. He predicted that the two leaders will express “a focus on the need to strengthen their economic security, to respond to concrete threats to economic security” from China and that the US and Europe are aligning in an unprecedented way. In their joint statement, von der Leyen and Biden made only fleeting mention of China.
