Home Economy France plays bad cop as transatlantic trade tensions ramp up – POLITICO

France plays bad cop as transatlantic trade tensions ramp up – POLITICO

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PARIS — US President Joe Biden needs to watch out. France is reclaiming its traditional role as a European troublemaker at the forefront of transatlantic trade.

Divergence between Brussels and Washington appeared to be easing under Biden’s watch. made a truce About the tariffs that former President Donald Trump slapped on European steel and aluminum. This past year, Russia’s war against Ukraine meant that America and Europe needed to show a united front, at least politically.

But cracks are starting to appear again. The EU is furious that the US is pouring subsidies into the domestic electric car industry. Condemning Washington’s protectionism, Europe now threatens to formulate its own defenses.

Unsurprisingly, French President Emmanuel Macron is in the lead. “The Americans have bought the Americans and are pursuing a very aggressive strategy of state aid. The Chinese are closing their markets. Yes, and I do not think that there is no European preference. Said French daily Les Echos.

Raising hopes, he called on Brussels to help consumers and businesses buy electric cars produced in the EU, rather than electric cars from outside the bloc.

European countries are struggling with their trade balances for good reason.

The war had a huge impact on terms of trade, and rising energy costs dragged the EU across the yawning bloc. trade deficit It reached €65 billion in August, up from just €7 billion the previous year. In one symptom of those strains, Europe’s growing dependence Tensions have reignited over US liquefied natural gas to replace lost Russian supplies.

Macron’s comments reflect the EU’s surprise at Washington’s decision. Inflation control lawmotivates US consumers to “buy America” when making purchases A greener car. The EU argues that requiring that vehicles must be assembled in North America and have batteries with a certain percentage of local content discriminates against the EU and other trading partners.

The European Commission wants to persuade Washington to find diplomatic compromises for European automakers and their suppliers. If not, the EU will have no choice but to challenge Washington against the World Trade Organization, EU officials and diplomats. Said POLITICO — A new Atlantic trade war, even if neither side wants to spend time and money.

Ervir Fabry, a trade policy expert at the Jacques Delor Institute in Paris, said Mr Macron’s remarks were “clearly a rebuttal to the anti-inflation law”. “Macron plays the role of a bad cop compared to the European Commission, which left Washington with room for political coordination,” she noted.

“American domination”

The European Commission hopes to find a diplomatic compromise with the United States for European automakers and their suppliers. Ludovic Marin/AFP via Getty Images

France has traditionally been the most outspoken country of the bloc when it comes to confronting Washington on a wide range of trade issues. killing The Transatlantic Trade Agreement (so-called “TTIP”) between the EU and the US. The digital tax angered US Big Tech, triggered Trade war with the Trump administration.

Most recently, at the EU Rotational Presidency Council in Paris concentration On trade defensive measures empowering Brussels to retaliate against unilateral trade measures: including from America.

The renewed tension is bad news for the upcoming Trade and Tech Council meeting in early December.

France will not be left alone in a potential trade war over electric vehicles. The German auto industry has also been particularly affected by the US measures, so these tensions will bring Paris and Berlin closer together, Fabry said.

But the “buy American” approach is not the only point of contention. The fact that Europe is increasingly dependent on gas imports from the United States has taken European dissatisfaction to the next level.

nevertheless gas import prices It fell in September from an all-time high in August, but was still more than 2.5 times as high as it was a year ago. Also, his LNG import bill for France has doubled given the increased purchases. ten times more According to one estimate, in August compared to the previous year.

Last week, Minister of Economy and Finance Bruno Le Maire warned Russia’s war against Ukraine should not result in “American economic dominance and a weakening of Europe.” Lemaire criticized the United States for selling LNG to Europe “at four times the price it would sell to its own companies” and urged Brussels to act for a “more balanced economic relationship” between the two continents. asked to wake up

POLITICO found that the very same concerns were shared by some Commission officials, but also among French businessmen.

Bernard Spitz, head of international and European affairs at the French business lobby Medef, said it was unlikely that the United States had any economic gains from the war in Ukraine and suffered less from its economic impact than Europe. “It’s almost uncontroversial,” he said.

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