The threat of a trade war between the EU and the US over the Biden administration’s $370bn climate legislation has stepped up, as France estimated it would lose €8bn as businesses were given incentives to shift to the US.
Brussels is demanding that products made in the EU bloc should have access to the same subsidies as the US is offering to a range of industries to spur green technologies and tackle carbon emissions under its Inflation Reduction Act.
The IRA measures include tax rebates for buyers of US-made electric cars, as well as a series of other significant industry credits for domestic clean energy initiatives, such as solar, wind, nuclear and carbon capture technologies.
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