EU and US officials committed in principle to resolving a dispute over electric vehicle (EV) incentives that threatens to spark a trade war, without Washington making specific concessions and time running short.
The Inflation Reduction Act (IRA), which the EU says provides unfair subsidies to US manufacturers and threatens to undermine the transatlantic relationship, has caused alarm in European capitals that only eased during French President Emmanuel Macron’s visit with US President Joe Biden last week.
US officials continued the charm offensive, with representatives from the European Commission on Monday at the third Trade and Technology Council meeting in College Park, Maryland, north of Washington.
European Commissioner for an Economy that Works for People Valdis Dombrovskis said that he was leaving the meeting “more optimistic than when we arrived,” but stressed urgency.
“We don’t have long — the IRA is due to be implemented next January,” he said. “We need to see results still this year.”
It could be difficult for the US to find a way of placating Europe, as the IRA has already passed. EU officials are pushing for the US to provide exceptions to European countries — similar to what Canada and Mexico have.
The most likely route to try to accommodate EU concerns would be for the US Department of the Treasury to issue a waiver allowing European vehicles to qualify, said William Reinsch, who served as undersecretary of commerce for export administration in former US president Bill Clinton’s administration.
While such an interpretation of the law would be unlikely to hold up in court in the face of lawsuits from groups that favor a stricter interpretation, that process could take years to play out, providing an interim solution, said Reinsch, now a senior adviser at the Center for Strategic and International Studies in Washington.
In Europe, more politicians are calling for a regional response that would rival the IRA — a move that risks shifting the fight over industrial subsidies from the US to within the bloc.
In a speech over the weekend, European Commission President Ursula von der Leyen pushed to re-examine state-aid rules and create a European fund to invest in clean tech.
While backed by key countries such as France, these ideas are controversial for fiscally conservative EU countries and even within the commission.
German Minister of Finance Christian Lindner said the EU must be more agile, and there is “room for improvement” on state aid, but called for more debate on other aspects of Von der Leyen’s proposal, especially the creation of a European sovereignty fund.
“If that means a kind of rebranding of existing tools, I’m open to discussion,” Lindner said.
However, if it means issuing new common European debt, “then I think this would not be an improvement of our competitiveness or stability — it would be a threat,” he said.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts