TTC: EU-US Cooperation May Follow on Trade Remedies for Semiconductors

The U.S. and the EU will consult each other on planned action, and "may develop joint or cooperative measures to address distortionary effects on the global supply chain for legacy semiconductors," a joint statement from the ministerial meeting of the U.S.-EU Trade and Technology Council said. Both regions are offering government incentives to produce semiconductors, but if Chinese semiconductors are still cheaper than their own, delayed projects in Ohio and Arizona could be canceled.

The statement, released at the end of the two-day meeting in Belgium on April 5, said non-market economic policies and practices can lead to excessive dependencies for legacy semiconductors. "On the side of the fifth TTC ministerial meeting, which took place on 30 January 2024 in Washington, D.C., we held a joint roundtable with high-level industry representatives dedicated to legacy semiconductor supply chains. Both the European Union and the United States are committed to continuing to engage closely with industry on the issue. We plan to convene further government-to-government discussions with likeminded countries on this topic in the near future." Both regions are surveying producers to understand how even mature semiconductors have national security ramifications.

The statement said the EU and the U.S. have talked with other countries that are also concerned about China's non-market policies and practices in medical device manufacturing, and that they told China about their concerns. They said they will continue to monitor developments in the sector.

The EU and the U.S. also talked about how to decrease dependency on Chinese firms for the solar supply chain -- including panel making equipment -- and said they will hold a workshop for stakeholders on "the management of sustainable supply chains, including a focused session on solar."

They said a "certain third country" has attained a dominant global position in clean energy through non-market practices. "We will continue to explore policy tools and possible coordinated action to address harm caused by these policies and practices, including by fostering supply chain diversification, reducing dependencies, and building resilience to economic coercion."

The EU and the U.S. have still not reached a critical minerals agreement, which would allow electric vehicle batteries which include EU mined, processed or recycled materials to qualify for Inflation Reduction Act purchase subsidies. But the statement said they are advancing those negotiations.

No more ministerial meetings are scheduled before the U.S. and the EU parliamentary elections. They said: "As the European Union and the United States enter their respective electoral processes, the work we do under the TTC will remain relevant, strategic, and timely, while allowing for the necessary flexibility to adapt to changing circumstances.

"Building on the lessons learnt from our cooperation so far, we intend to use the remainder of 2024 to engage with European Union and United States stakeholders to learn their views on the future of the TTC."