France, Germany to voice concerns over IRA in US

Shiva Singh
IRA inflation reduction act symbol. Concept words IRA inflation reduction act on white note on a beautiful background from dollar bills. Business IRA inflation reduction act concept. Copy space.

Belgium, (Brussels Morning Newspaper) France and Germany are planning to voice concerns over the US Inflation Reduction Act (IRA) to US officials this week.

French Economy Minister Bruno Le Maire and his German counterpart Robert Habeck will visit Washington on Tuesday and attend meetings with senior US officials, according to Reuters reporting on Saturday.

The IRA includes state subsidies for companies in the green sector, with some EU officials expressing concerns that it will drive investors away from the bloc and towards the US.

According to some EU governments, IRA would put green companies in the bloc at an unfair disadvantage and could be used to poach investments from the EU.

Two French officials pointed out that the ministers will meet with US Secretary of the Treasury Janet Yellen, US Secretary of Commerce Gina Raimondo and US Trade Representative Katherine Tai.

The goal of the visit

“One of the ministers’ messages will be to not approach European companies about moving plants to the US… there will be enough room for everyone to invest both in Europe and the US,” one French official noted.

The second one added that the EU wants to avoid “aggressive pitches” to EU companies to direct their investments towards the US.

The two officials pointed out that the EU wants the US to be more transparent about the subsidies offered to companies under the IRA, adding that the two ministers will try to convince US officials to make the IRA more lenient when it comes to local production of materials used in the green sector.

One EU official noted that, under IRA, subsidies apply to production in the US as well as inputs from Canada and Mexico, stressing that the bloc wants similar treatment.

Germany is concerned about potential effects of the IRA on its automotive industry, among other, which is the backbone of the country’s exporting success.

German Chancellor Olaf Scholz announced last month that the state plans to make nearly 180 billion euro available for green investments in the period between 2023 and 2026.

For comparison, the IRA includes subsidies of roughly USD 370 billion over a period of 10 years.

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Shiva is a professional digital marketer who covers the latest updates in the tech industry from across the globe. With an experience of over 5 years in the world of Information Technology, he likes to keep up with every major development and writes fact-based pieces backed by in-depth research.