PRAGUE (Reuters) – European Union trade ministers and U.S. Trade Representative Katherine Tai were holding talks in Prague on Monday to debate find out how to cope with U.S. laws that the EU sees as discriminating against its electric car-makers.
The ministers were also taking a look at extending trade support for Ukraine and hope that a trade cope with Latin American countries moves forward following Brazil’s presidential election, the ministers said on entering the talks.
Non-U.S. automotive makers have been angered by the U.S. $430 billion “Inflation Reduction Act” from August which is geared toward fighting climate change and making Washington a world leader in the electrical vehicle market.
The U.S. law says that electric vehicles need to be assembled in North America to qualify for tax credits. The EU says this discriminates against EU-made cars and U.S. vehicles sold in Europe benefit from the same tax breaks as European ones.
The EU and United States have arrange a task force to cope with the difficulty and Tai was participating within the Prague meeting to debate it.
“We’re all in all on a positive track and it is rather essential we’re cooperating closely between the EU and america as strategic allies, especially within the situation we face straight away,” European Commission Vice President Valdis Dombrovskis, accountable for trade, said ahead of the meeting within the context of Russia’s invasion of Ukraine.
“There are also concerns related to the Inflation Reduction Act and its discriminatory provisions. On this regard we now have arrange an EU-U.S. task force to cope with these issues.”
Czech Industry and Trade Minister Jozef Sikela said there was no deadline for the talks but the present status was unacceptable for Europe.
“I will probably be pretty frank. I believe in the shape it was presented, I believe for the European Union it’s unacceptable. And we simply expect we are going to get the identical status as Canada and Mexico,” Sikela told reporters.
Sikela said the victory of Brazilian leftist leader Luiz Inacio Lula da Silva in a presidential election on Sunday could help move ahead talks with South America’s Mercosur bloc on a stalled trade agreement.
(Reporting by Jan Lopatka; Editing by Nick Macfie)
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