The European Union announced a plan to introduce a Net-Zero Industry Act to increase funding for clean technologies in the bloc in response to the United States’ Inflation Reduction Act, thereby increasing chances of protectionism in trade getting fiercer for a while as both Washington and the EU have decided to give out grants.
Ursula von der Leyen, president of the European Commission, said in the plenary session of the European Parliament on Wednesday (local time) that “speed and access” are essential to nurturing eco-friendly industries. She focused on building a regulatory environment to help scale up clean technologies fast and ensure favorable industrial conditions. In this regard, she put forward a new Net Zero Industry Act.
President von der Leyen explained that the newly proposed act would align with the EU Chips Act, implying the region’s strong determination to help related businesses by streamlining approval procedures for building clean industry facilities.
The EU Chips Act, previously announced, aims to increase the member states’ market share from 9 to 20 percent in the global semiconductor production market by 2030, which will be supported by an investment plan to spend 43 billion euros on expanding a manufacturing framework.
With the U.S. IRA in place, the EU is concerned that its member states will suffer weaker industrial competitiveness, worrying that green businesses with great potential for growth may see the United States as a more attractive investment destination than Europe.
Just like the South Korean government, the EU has also called on the U.S. government to amend the IRA, which it considers a discriminatory system that gives tax benefits to electric cars produced in the North American region. However, with less progress made in the negotiations with Washington, it seems intended to respond by announcing a new act to pledge to offer grants.
Eun-A Cho email@example.com