EU-US Trade and Technology Council: Modest progress in a challenging context

Summary:

The European Union-United States Trade and Technology Council (TTC) was launched during a June 2021 summit. The aim was to revitalise transatlantic cooperation, boost bilateral trade and investment, and strengthen the parties' technological and industrial leadership, while preserving shared values. The TTC has held three high-level political meetings so far. These ministerial meetings steer cooperation within the TTC and guide its 10 working groups on technology standards, secure supply chains, tech regulation, global trade challenges, climate and green technologies, investment screening and export controls. The first two meetings focused on launching the TTC and setting its agenda, while the third – in December 2022 – was described as a 'shift to deliverables'.

The war in Ukraine has strengthened the transatlantic alliance and created numerous new challenges, to which the TTC has responded, in particular with a swift and coordinated roll-out of export controls. The latest TTC meeting agenda was also influenced by the US Inflation Reduction Act (IRA). Adopted in August 2022, this act earmarked nearly US$370 billion to boost the US fight against climate change and its domestic industry. While some in the EU have approved this increased commitment on the part of the US to climate-related spending, others have voiced concerns about the risks of the IRA triggering a relocation of EU businesses to the US in pursuit of the generous subsidies, grants and tax credits the newly adopted act has promised. So far, the TTC's work has focused mostly on information sharing, joint mapping, defining best practice, identifying risks and exploring options for closer cooperation. The third meeting made progress on artificial intelligence standards, global connectivity, transparency of semiconductor supply chains, meaningful dialogue on forced labour and due diligence, sustainable trade, post quantum encryption and China's non-market practices. Observers are divided on whether the TTC should tackle major bilateral trade irritants or work mainly on the forward-looking policies. All agree, however, that the next meeting, set to take place in May or June 2023 in Sweden, must deliver substantial and tangible results if the TTC is to remain relevant and not lose momentum.

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