EU chief Ursula von der Leyen on Tuesday announced the preparation of a "sovereignty fund" and a Net Zero Industry Act, both intended to defend Europe's industrial base from subsidised US and Chinese competitors.
The European Sovereignty Fund would come as "part of the mid-term review of our budget this year", Von der Leyen said in a speech at the World Economic Forum in Davos. The Net Zero Industry Act is intended to boost clean technologies.
Von der Leyen launched the idea of the fund in September last year, saying it was necessary for Europe to "adapt to the new global realities".
Singling out areas "as varied as batteries, hydrogen, semiconductors and raw materials," Von der Leyen said the time had come "to take these efforts to the next level to increase Europe's strategic autonomy".
The Net Zero Industry Act would propose a series of clean technology objectives for 2030 and is aimed at competing with the US Inflation Reduction Act, a $369 billion green subsidy package that the EU fears will damage European industries.
"It is no secret that certain elements of the design of the Inflation Reduction Act raised a number of concerns in terms of some of the targeted incentives for companies," according to Von der Leyen.
But US climate envoy John Kerry countered that countries complaining about the act should instead try to imitate the United States.
"The reaction of other countries shouldn't be, 'oh my god, you shouldn't be doing that, that's putting us in an unfair position'. Do it, too. Everybody's got to do the same thing to accelerate this process even more," Kerry said at a panel discussion on boosting philanthropic involvement in climate change.
Investigations
Von der Leyen also took aim at Chinese subsidies for its domestic clean technology industries.
"We see aggressive attempts to attract our industrial capacities away to China and elsewhere," she said.
"China heavily subsidies its industry and restricts access to its market for EU companies.
"We will not hesitate to open investigations if we consider that our procurement or other markets are being distorted by such subsidies."
China's vice premier Liu He called for an end "to Cold War mentality".
China's export-oriented economy is seen as being particularly threatened by changes to the global trading system, with the United States looking to shore up its domestic industry and limit trade with Beijing in strategic sectors.
The theme of this year's meeting in Davos is "Cooperation in a fragmented world," a nod to international tensions caused by the war in Ukraine and increased rivalry between the United States and China.
"How to strengthen cooperation in a fragmented world is a real problem we all face," Liu said.
China published its own whitebook on clean energy in 2020 in which Beijing pledges to "remain committed to an energy revolution, and move faster to build a clean, low-carbon, safe and efficient energy system" by the middle of this century.
(With newswires)
