Growing American protectionism, with its exclusive subsidies for electric cars and the probable return of the Trump era’s steel and aluminum tariffs, was on the list of priorities at the summit of European leaders with Joe Biden held this Friday in the White House. However, the geopolitical context has disrupted their plans, turning the meeting with the American president into an exhibition of support for Israel by the president of the European Commission, Ursula Von der Leyen, the president of the European Council, Charles Michel, and the high representative of the Union for Foreign Affairs, Josep Borrell.
“Today the world faces enormous challenges, which is why a strong alliance between the EU and the US is necessary more than ever,” said Michel at the beginning of the trilateral meeting. For his part, Von der Leyen thanked the American president for “his extraordinary visit” to Tel Aviv. “It is important to show solidarity with Israel, which has been the victim of the worst attack since the Holocaust. “Israel has the right to self-defense in accordance with humanitarian law,” he assured.
The EU and the US stand with Israel and against terror.
Israel has the right of self-defense, in line with international humanitarian law.
We are also both increasing humanitarian aid to civilians in Gaza. pic.twitter.com/sSPlILCuJ8
— Ursula von der Leyen (@vonderleyen) October 20, 2023
“I was also in Israel. Exactly a week ago, I went to the kibbutz and what I saw was outrageous,” she said. This visit cost him the reprimand of several Member States, as well as Michel and Borrell, for establishing himself as the international voice of the EU, when it is a role that does not correspond to him. These differences have also been evident this Friday. After receiving all the European leaders, Biden finally had a separate meeting in which Von der Leyen was not present, but the president of the European Council and the high representative of the Union did participate, exemplifying the preponderance of both. institutions in matters of foreign policy.
During the last summit between the EU and the US, which took place in 2021, “we committed to revitalizing the partnership between the EU and the US, and in the last two years we have fulfilled that commitment,” Biden celebrated. “We have together supported the brave people of Ukraine in the face of Putin’s aggression. And we stood united to confront economic challenges, we established norms to guide our relationship with China, and we stand united now to support Israel in the wake of the heinous terrorist attack by Hamas.”
In a joint statement, both sides have condemned “in the strongest terms” Hamas and its “brutal terrorist attacks” in Israel. And they have pointed out the importance of protecting civilians and facilitating “access to food, water, medical assistance and shelter.” While staging their support for Israel, the leaders assure that they are “concerned about the deterioration of the humanitarian crisis in Gaza” and have highlighted the importance of “preventing a regional escalation.”
“We will not let events in the Middle East distract us from our strong support for Ukraine. Democracies must remain strong,” Von der Leyen said. Since the invasion of Ukraine, the EU has sent 85 billion euros in aid to the Eastern European country, and has recently approved the sending of another additional 50 billion, which will be distributed between 2024 and 2027. For its part, the US has sent about 40,000 million euros, to which will be added the 56,000 million promised yesterday by Biden in prime timeas long as Congress is able to overcome its paralysis.
No solution to trade disputes
Given the supremacy of Israel and Ukraine, the bilateral trade relationship has taken a back seat during this Friday’s meeting. One of the issues on the table were the more than 200 tariffs that Donald Trump imposed on the export of European products.
Of all of them, the Biden Administration suspended the tariffs on steel and aluminum imports imposed by the previous president in 2018, which were later declared illegal by the World Trade Organization (WTO). However, this suspension was temporary, pending a definitive agreement, which European leaders wanted to reach in the days before meeting with Biden.
If a common point is not reached, levies will resume from 2024, something that, they declare, neither party would want. In exchange for good trade conditions between Brussels and Washington, the Biden Administration wants the EU to put limits on Chinese imports, which are flooding international markets with their cheaper-produced steel. However, the EU claims that it will not be able to do so until the conclusions of a WTO investigation into the legality of such tariffs are reached.
One of the solutions that the US has put on the table is the creation of the so-called “carbon club” between the North American country and the community bloc, which promotes the production of sustainable and decarbonized steel, and which imposes tariffs on third countries that do not produce sustainably. In practice, it would be a way to exclude China from trade between the two partners, without raising tariffs on Beijing directly.
The trade differences are also transferred to the subsidies and tax exemptions approved a year ago by the US Congress (the Inflation Reduction Act), which put favorable conditions on the manufacturing of batteries and electric cars in the US. A protectionist measure that the EU has criticized because it considers harmful to companies established in its territory, which could choose to go to the North American country.
Although both parties say that there is progress in reaching an agreement so that electric vehicles with critical materials from the EU (such as cobalt, graphite, lithium, manganese or nickel) can benefit in part from the tax exemptions, there is no concrete announcement yet.
