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Europe says it is ready to dig up the hatchet against the United States, because of American subsidies for the electric car favoring the ” made in USA “. Are the two partners and allies about to relaunch the trade war?
« The Europeans will go to the World Trade Organization (WTO) if necessary says Internal Market Commissioner Thierry Breton. The WTO is a forum where the battles promise to be long and costly. Washington and Brussels are well placed to know this since they have scrapped for 15 years over the grants awarded on both sides of the Atlantic to their respective aeronautical champions. Thierry Breton goes further: he brandishes the threat of reprisals.
Let us recall the facts: as part of the fight against inflation, Joe Biden announced this summer a vast aid plan with a particularly irritating measure for Europeans. This is a tax credit, up to $7,500, for the purchase of an electric car, provided it comes from an American factorybattery included.
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Protectionism
We can speak of protectionism, European cars finding themselves, in fact, discriminated against on the American market. For the European car industry, it’s a double penalty: it already suffers from a distortion of competition with the United States because of the differences in price and energy supply, now it has to cash in on its eviction from the market of the electric car, the most promising segment of the American market. This is all the more frustrating for Europeans as the boosts granted to the electric vehicle apply to all cars, regardless of their country of origin.
Is this the great return of theAmerica first ?
It looks very similar. It was hastily believed that the ” Make America Great Again was outdated since Donald Trump’s defeat at the White House, but his ideas continue to flow, to infuse, including within the Democratic Party. With a size difference: Donald Trump declared his trade war on China then to Europe with the rise in customs duties, while Joe Biden takes a measure that is not offensive, but defensive, intended to support his industry as a priority.
The electoral ulterior motives, on the other hand, are the same: to win the hearts and therefore the votes of American blue-collar workers. These workers of the rust beltin particular from Pennsylvania, turned away from Democrats to vote for Trump six years ago; today in the midterm elections, they may again prefer to lean in favor of the Republican candidates.
A more dramatic ecological context
With the already very noticeable warming of the planet and the surge in crude oil prices, there is an urgent need to develop alternative solutions. The vast American plan announced this summer responds to this urgency. The problem is that Joe Biden preferred to move forward solo rather than collectively.
Only joint action by the States can effectively contribute to the fight against global warming, declaim in all tones the experts meeting at the moment at the COP27 in Egypt. Will this message be heard in Washington? To avoid the trade war that the Europeans are ready to activate, the representatives of the two countries will meet in December for a council devoted to trade issues. The result of this Tuesday’s ballot will of course have a decisive influence on their future discussions.