O. Scholz is worried that US climate protection plans could lead to a tariff war - Business News

2022-10-11 13:14:44 By : Mr. Shangguo Ma

Need help?Contact the Customer Service Department of "Verslo žinios".by phone (8 5) 252 6330 or e-mailby mail prenumerata@verslozinios.lt.Olaf Scholz, Germany's chancellor, on Tuesday criticized US climate protection plans that would simultaneously shield domestic companies from foreign competition, saying the new rules could lead to a "massive tariff war".Foreign countries are worried about US President Joe Biden's "Detection Act", which provides huge spending on green energy initiatives and tax breaks for American electric car and battery manufacturers."We will discuss the anti-inflation law with our American friends," Scholz said at the VDMA meeting in Berlin."It is impossible for politicians in their countries to say: 'Now we are dealing with climate protection, dear industry, have you heard that we will also protect you from competition?'" said the chancellor."It would end in a massive tariff war," Scholz warned, calling for closer international cooperation on climate protection measures and trade.Mr. Scholz, whose country is home to automobile manufacturing giants Volkswagen, BMW and Mercedes, did not elaborate on which aspects of Mr. Biden's plans he opposes.However, European Union (EU) officials have spoken out in recent weeks against planned U.S. tax breaks for the local electric car market, saying it would put such vehicles made elsewhere at an unfair disadvantage.Valdis Dombrovskis, Vice-President of the European Commission and Trade Commissioner, told Bloomberg news agency last month that the Community is concerned about "several discriminatory elements" in the Inflation Reduction Act.According to him, the EU is assessing whether the legislation does not violate the rules of the World Trade Organization.And at the engineering conference held in Berlin on Tuesday, V. Dombrovskis stated that EU companies cannot distance themselves from China, because the war in Ukraine is redefining the Community's approach to important trade partners."The EU should continue to communicate with China pragmatically and without naivety.Our trade relationship needs more balance and reciprocity," he said, calling for a greater focus on better risk management and diversification rather than retreat, according to Reuters.According to him, China has also changed the EU's relations with another important trade partner - the USA."The transatlantic relationship has revived," he said, but there are "major concerns" about the U.S. deflationary law and its benefits for U.S. companies.V. 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