US, EU to discuss subsidies and minerals deal amid trade dispute

WASHINGTON, March 10 (Reuters) – President Joe Biden and European Commission President Ursula von der Leyen are talking on Friday amid trade friction that could lead to talks over critical minerals used for electric vehicles and fuels. government subsidies, according to US sources.

Biden and von der Leyen will meet at the White House at 2 p.m. EST (1900 GMT) amid European complaints that the subsidies, included in the US Inflation Reduction Act, will divert investment away from Europe and will hurt their savings.

Senior Biden administration officials who briefed reporters ahead of the talks said they hoped the two leaders would agree to begin negotiations on an agreement on critical minerals for electric vehicle batteries and a dialogue on the “transparency of subsidy incentives”.

“This is a deal really focused on minerals critical to electric vehicle batteries and battery supply chains. Hopefully this is a limited scope deal on critical minerals that address these needs,” said a senior official.

Biden’s Inflation Reduction Act (IRA), a $430 billion bill that provides massive subsidies for products made in the United States to combat the climate crisis and encourage renewable energy, has drawn the ire of Europe.

The senior official said the subsidy dialogue would aim to ensure that the United States and Europe are not working at cross purposes.

The two leaders will also discuss ways to strengthen cooperation by imposing sanctions on “third parties” who violate Russia’s sanctions over the war in Ukraine, the officials said.

(Reporting by Steve Holland; Editing by Cynthia Osterman, Spanish editing by José Muñoz)