WASHINGTON. The goal is twofold: to reduce pollution and protect domestic industries from Chinese production surplus. And to get it, Washington and Brussels would be considering a new round of duties on Chinese steel and aluminum. The plan – according to what was revealed by the Bloomberg agency – would still be in an embryonic stage but was given the green light by President Biden.
China produces over half of the world‘s steel and is accused by the United States and Brussels of “overproduction” so as to undermine the survival of American and EU steel companies.
White House sources familiar with the dossier said it was unlikely the project would be formally discussed with Europeans before the second half of next year.
But some steps have already been taken. US Commerce Undersecretary Katherine Tai discussed it in October in Prague with EU Commission Vice President Valdis Dombrovskis. Biden seems willing to go down this path even if he is aware of jeopardizing the newfound harmony with Xi after the three-hour talks on the sidelines of the G20 in Bali on November 14th.
In Bali, among other things, the US and Chinese envoys had reiterated the need to work together precisely in the fight against climate change.
However, the US idea of involving Europeans and creating an axis on the “green” issue and tariffs would help America sweeten the pill in Brussels, which was displaced and disappointed by the approval of the IRA (Inflation Reduction Act) which pours billions dollars in subsidies to companies that produce in America, reducing their dependence on fossil fuels, guaranteeing them a competitive advantage over their European competitors.
Again Bloomberg reported that it is not clear what legal instrument the US administration would adopt to curb Beijing’s exports, but Congress has already been alerted – as well as the world of industry – regarding the creation of a new “authority”.
It is possible that during the Trade Technology Council between the US and the EU held yesterday in Maryland it was discussed. At the table were representatives of Europe Domborvskis and the other Vice-President of the Commission Margrethe Vestager; for the USA, in addition to Tai, also the secretary of Commerce Gina Raimondo and the secretary of state Antony Blinken who did the honors.
Washington has opened up to European objections on IRA. The law will not be revised but some adjustments on state aid could come. A mixed task force will be created to identify the methods. But the Americans’ signal of openness, in light of the hard line that Washington intends to take with China, is already a positive signal for Europe.