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US and EU: Robert Habeck announces “robust response” to US subsidies


US President Joe Biden is launching a multi-billion dollar renewable energy aid program. The problem from a European point of view: the money is tied to production in the USA. Economics Minister Habeck is alarmed.

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Robert Habeck: "Anyone who believes that we will let Germany go to waste as an industrial location has reckoned without German industry"

Photo: Christian Mang / REUTERS

Federal Economics Minister Robert Habeck has announced a "robust response" by the European Union to the subsidies in the USA, which are viewed critically in Europe.

Habeck referred to the so-called Inflation Reduction Act of the USA - a 370 billion dollar aid program with which, among other things, renewable energies and industry are to be strengthened in the fight against the climate crisis.

One will react with similar measures, said the Green politician at an industry conference in Berlin.

In the aid program, subsidies and tax credits are linked to companies using US products or producing in the US.

The fear is that companies are more likely to invest in the USA than in Germany and Europe, also because of tax advantages.

There is criticism that the US law could put European and other foreign companies at a disadvantage.

It is positive that the USA wanted to lower inflation and is now massively promoting investments in green technologies, said Habeck, but also spoke of a "dark side".

Regulations that must be produced in America are not compatible with the rules of the World Trade Organization WTO.

There must be a European plan parallel to the talks with the USA.

plans for Europe

He suggested several points

to strengthen Europe's competitiveness


  • The

    production of solar and wind power plants

    must be strengthened.

  • Approval procedures

    need to



  • and Europe must


    implementing important projects

    more quickly


  • Public tenders

    must focus more on production




  • In addition, more attractive tax conditions

    are needed

  • and everything must be done

    against the shortage of skilled workers


In view of an imminent trade conflict with the USA, Habeck announced a more active industrial policy in Germany and the EU.

He said: "Anyone who believes that we will let Germany go bust as an industrial location has reckoned without German industry." The federal government is also determined to act.

According to Habeck, the next year will be dominated by industrial policy.

The aim is to expand site security and to advance the fundamental change towards a climate-neutral and digital economy.

Industry President Siegfried Russwurm said, with regard to energy costs, which are high by international comparison, that the risk of companies moving away is real.

Habeck explained that the goal must now be to strengthen Europe's sovereignty and global competitiveness.

With a view to the USA and China, he spoke of a situation that was becoming more challenging for Germany as an export nation.

The minister had already warned against one-sided dependence on China for raw materials and called on the economy to position itself more broadly in Asia.

IG Metall calls for an "offensive" in industrial policy

EU Internal Market Commissioner Thierry Breton said the European Union will not remain passive in the face of the new US subsidies.

A quick answer is needed, talk to the Americans.

The EU must make faster decisions about projects to promote future technologies.

Industry President Siegfried Russwurm called high energy costs a "handicap" for German companies.

The federal government's planned gas and electricity price brake cushions "peaks", but there is a new normality of high prices.

Russwurm demanded that politicians must increase investments in the expansion of renewable energies and in the necessary change processes in industry, for example for the rapid ramp-up of the hydrogen economy.

Jörg Hofmann, first chairman of IG Metall, advocated an "offensive" in industrial policy.

Structural policy answers are needed.


Source: spiegel

All business articles on 2022-11-29

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