US, EU Talk Trade, Semiconductors at TTC
The U.S. and the EU held the fifth meeting of the U.S.-EU Trade and Technology Council in Washington on Jan. 30, where the two sides again committed to increasing trade and cooperating on economic security and emerging technology issues, according to a European Commission readout of the meeting. The commission said the EU and the U.S. agreed to “explore ways to facilitate trade in goods and technologies that are vital for the green transition” and strengthen approaches to investment screening, export controls, outbound investment and “dual-use innovation.”
The EU also said the U.S. and EU this week held a roundtable on the semiconductor supply chain took place in the margins of the TTC, “focusing on developments and potential cooperation in the legacy semiconductor supply chains.”
At a think tank appearance after the meeting, European Commission Executive Vice President Margarethe Vestager said the two sides had a "very intense roundtable" earlier that day talking about how to cooperate on the support of mature chip production to prevent shortages and dependency on China in that segment.
She said talks such as these are about "how to make economic security a real thing."
The two sides also are “intensifying their coordination” on issues surrounding critical raw materials used to make semiconductors, the readout said. It specifically mentioned Chinese export controls on gallium and germanium announced last year (see 2307050018 and 2310030035).
Vestager said that although 22 EU member states have foreign direct investment screening, all of them need to do so.
"We need a European prism for export controls," she said. "And then we have taken the first steps to try to figure out that some would circumvent export controls by outbound investment."
But she said that is something the EU wants to be very precise with, because it does not want to curtail globalization, which she said really benefits the region. But they do need to address the risk of overdependence on China, Vestager said.
Commerce Secretary Gina Raimondo said at the Atlantic Council event, "We’re working together in the way we’re implementing our Chips Acts. We can’t allow companies to play us off each other and get into a subsidies race."
Raimondo also brought up the unlevel trading playing field that has inspired the Chips Act. She said that China's rise as an electric vehicle exporter raises issues around both market distortion and data security. The U.S. imports very few Chinese-made EVs, due to 27.5% tariffs on Chinese passenger cars; the EU imports more, and has begun a trade remedy investigation.
"Our interests are aligned," Raimondo said. "I feel we’ve done quite a lot, tangible results in a short period of time."