US, EU trade and tech council: chip supplies, China trade
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Katherine Tai, U.S. trade representative, from left, Gina Raimondo, U.S. commerce secretary, Antony Blinken, U.S. secretary of state, Valdis Dombrovskis, trade commissioner for the European Union (EU), and Margrethe Vestager, competition commissioner of the European Commission.
Getty Images London — In what may be the first meeting of its kind, the United States and European Union agreed to “rebalance” global supply chains for semiconductors.| Bloomberg | Getty Images
LONDON — The United States and the European Union have agreed to a “rebalancing” of global supply chains when it comes to semiconductors, in what could be the first of many trade and tech focused meetings.
The U.S.-EU Trade and Technology Council, referred to as TTC, emerged in the wake of Joe Biden‘s presidential victory as the European Commission, the executive arm of the EU, looked to overcome transatlantic disputes in these areas. Trump’s administration had placed tariffs on EU members and the bloc was eager to work with him.
Pittsburgh hosted the group’s first gathering on Wednesday. After Australia decided to abandon a sub-marine deal with France and instead choose a U.S. arrangement, which angered France, preparations were stalled.
According to reports, French frustration diluted the statements made by the sides after the conclusion of Wednesday’s meeting.
Cecilia Bonefeld-Dahl, director-general of DigitalEurope which represents tech companies and trade associations, told CNBC that she hopes the U.S. and the EU will keep geopolitical and industrial issues apart.
Over the telephone, she stated that the U.S. also wants a strong and digital Europe.
What was the agreement?
Both sides reached an agreement to “identify gaps in the semiconductor value chains and strengthen our domestic semiconductor ecosystems.”
In a joint statement, the group added that it is committed “to building a partnership on the rebalancing of global supply chains in semiconductors.”
This area has seen major disruption in the wake of the coronavirus pandemic. In the last months, the demand for chips has exceeded supply, which has had a major impact on the production of many electrical products including TVs, cars and other appliances.
Given its dependence on global supply chains, this concern is concerning for the EU.
As such, the commission is working on new policies to boost chip production in the bloc and reduce its dependence on other parts of the world.
Even though the last statement didn’t include China, many of the promises seemed to target Beijing.
According to the U.S., the EU, “We will work closely together in order to address nonmarket, trade–distortive practices and policies, increase the effectiveness of both our respective domestic measures, and we intend to cooperate closely.”
Beijing has been criticized numerous times for not granting foreign companies the same degree of access as Chinese businesses abroad.
Margrethe Vestager from Europe, the competition chief, tweeted, “Very satisfied with today’s interchange and joint declaration with our transatlantic partners.”
U.S. Trade Representative Katherine Tai stated that she was also “energized by today’s exchange and joint statement with our transatlantic partners” and looked forward to strengthening “our tech and trade partnership” with the EU.
How about tariffs on trade?
But, no progress has yet been made on tariffs.
In the summer, the U.S. agreed with the EU to reach a solution to the ongoing aluminum and steel tariffs that were imposed by Trump’s presidency. This compromise was reached earlier this year.
Valdis Dombrovskis (EU’s trade chief) stated that the EU is short of time earlier this week.
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