March 4. 2024. 7:21

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Czechia wants to avoid EU subsidy race, prefers negotiations with US


Entering a subsidy race by loosening state aid rules to compete with the US is something Czech officials, including its industry chief, want to avoid.

The US Inflation Reduction Act (IRA), a package that aims to boost US domestic green energy projects with subsidies and tax breaks, has put the EU on alert, with European Commission President Ursula von der Leyen recently countering with her Green Deal Industrial Plan proposal.

While EU leaders are set to discuss the EU’s response to act at this week’s European Council summit (9-10 February), Czechia does not like the idea of loosening state aid rules.

Though a final compromise among EU leaders will not be fleshed out at this summit, the European Commission did not negotiate support for its industrial plan before von der Leyen presented it last week, EURACTIV.cz learnt from Czech officials.

Czech MEP Alexandr Vondra (ODS, ECR) also criticised the Commission’s proposal.

“I think we could negotiate with the Americans to treat the EU similarly to, for example, Canada and Mexico, towards which the IRA is not so restrictive. But of course, this presupposes an initiative on the part of the EU,” Czech MEP Vondra, who is very close to the current Czech government, told EURACTIV.cz.

Czech officials confirmed that some exemptions for European companies have already been included in the US law.

According to Vondra, the EU should also slow down significantly in its efforts to regulate EU industry.

“We need to ensure that the EU’s efforts to decarbonise do not lead to the end of a whole range of industries in Europe. A truly predictable regulatory environment and technological neutrality is one way forward,” the Czech MEP said.

(Ondřej Plevák, Aneta Zachová | EURACTIV.cz)