(Geneva) Washington faced fresh criticism of its ‘green’ subsidies on Wednesday as the World Trade Organization, the European Union, the United Kingdom and other countries warned they risk upsetting supply chains. global supply.
These concerns were raised during the first day of the US Trade Policy Review, a process that the WTO’s 164 members regularly go through.
Washington’s main allies in Europe have expressed relief at improved trade relations after a few “complicated years”.
But Joao Aguiar Machado, EU ambassador to the WTO, said the bloc continued to have “serious concerns about the impact of certain US policies on trade”, warning “that it continues( ait) to be strong inward-looking tendencies in US trade policy, favoring national sectoral interests”.
He pointed to the recent passage of Washington’s landmark Inflation Reduction Act, which provides $420 billion in investment, much of it in the form of grants and tax cuts, particularly for electric vehicles, batteries and renewable energy projects that promote “made in the USA”.
Several European leaders, including French President Emmanuel Macron, have warned that the subsidies are encouraging European companies to relocate to the United States.
Machado warned that many of the subsidies in the law are tipping the balance of the game in favor of U.S. producers in key technology sectors, including but not limited to the automotive sector.
“Certain elements of the legislation, such as subsidies that depend on the use of domestic goods and domestic production, are discriminatory and must be reconciled with US obligations under the WTO,” said he warned.
His concerns were echoed by several other members, including the UK and Japan.
US Ambassador to the WTO, Maria Pagan, said the subsidies were necessary in the fight against climate change.
“We will not achieve our climate goals without bold action to promote major new investments in clean energy technologies, in particular incentives for the production of electric vehicles and their adoption,” she said during from the forum.
Earlier, German Chancellor Olaf Scholz had assured that the European Union would remain united against the United States regarding their climate plan deemed contrary to WTO rules by the Europeans.