Olaf Scholz in the Bundestag
Photo: Florian Gaertner / photothek / IMAGO
Federal Chancellor Olaf Scholz (SPD) has warned the EU against an "unchecked subsidy race" when responding to the multi-billion US aid package for green technologies.
This would be "certainly the wrong way," said Scholz in his government statement in the Bundestag before the EU special summit this week.
Scholz was reluctant to introduce new EU funding programs in response to the US measures.
"Careful analysis" is needed before decisions can be made.
With the so-called Inflation Reduction Act (IRA), the government of US President Joe Biden wants to provide extensive subsidies, for example in the form of tax breaks when buying electric cars or for the expansion of renewable energies.
There is sharp criticism in the EU because the funds are largely linked to production in the USA.
The EU and its member states criticize this as discriminatory and fear disadvantages for their companies and emigration to the USA.
The IRA in the USA has rekindled the discussion about an active industrial and location policy for future technologies in Europe, too, said Scholz.
»Cassandra calls« are »not indicated«.
On the one hand, it is "to be welcomed that the USA is finally approaching the transition to climate neutrality with the same determination as we are," said the Chancellor.
On the other hand, the EU has a whole range of funding programs for this area, from which hundreds of billions of euros are still available.
“If you put all of this alongside the $370 billion subsidy programs in the USA, you can see that Europe doesn’t need to hide,” emphasized Scholz.
"So we will take a very close look at whether and where our programs still leave gaps and how these can then be closed."
Union parliamentary group leader Friedrich Merz (CDU) criticized the debate on “Weeks and months of speechlessness” by the federal government in the EU about the US subsidy plan.
The reason is that the FDP-led Federal Ministry of Finance and the Federal Ministry of Economics led by the Greens do not agree on the reaction.
»Then the competitiveness is not damaged and called into question by Brussels politics, but by the disagreement and the weeks of quarreling in your coalition.«
Green parliamentary group leader Katharina Dröge, on the other hand, accused the Union of wanting to "continue to block every future trend and stick to technologies of the past".
The USA had now set an example “that is fully committed to climate protection”.
This is also “a message to the rest of the world: Anyone who still thinks they have to or can slow down climate-neutral technologies will end up endangering Europe as a business location.”