View from Brussels: Transatlantic ties at a critical juncture

US-EU relations are tense amid a presidential election campaign and ongoing pandemic. Where do the two sides stand on digital, energy and tech issues?

Depending on who emerges triumphant after November’s poll – incumbent Donald Trump or Joe Biden – ties between the US and Europe could either sour further or start to enjoy a resurgence. In some cases, it won’t matter who wins the White House.

The most obvious area is climate policy. If Trump secures a second term, then Europe will be forced to get tough with its green agenda, given that the Republican leader does not share the same urgency when it comes to environmental policy.

Much of the EU’s climate policymaking is predicated on the idea that the rest of the world will also start substantially cutting greenhouse gas emissions and investing in clean energy tech.

A Biden presidency – which would see the US rejoin the Paris Agreement on climate change – makes that plan work, while four more years of Trump makes life more difficult.

One major idea currently in the works is a carbon tax on the EU’s border. Imported products deemed to be too unsustainable would be slapped with a tariff, to prevent overseas manufacturers undercutting efforts of domestic companies that have gone green.

Yet a border tax is a difficult prospect for diplomats, who will have to convince the EU’s trading partners that it is not a protectionist tool hiding behind the skirts of climate action. Trump’s track record suggests that it would only damage transatlantic relations further.

More spats between Brussels and Washington would likely throw up more costly cases like the ongoing Airbus-Boeing dispute over alleged unfair subsidies.

The US has been given the go-ahead by the World Trade Organization to recoup billions of dollars by levying charges on other products, with the EU predicted to be granted the same right later this year.

A Biden presidency will not end the dispute, which has already been running for nearly two decades, but it would give the two sides a fighting chance of brokering some sort of resolution after years of escalation.

A window of opportunity opened earlier this year when Airbus said it had made concessions in existing aircraft contracts, but Washington insisted on pressing ahead with its tariffs on European goods.

The Boeing WTO case is due to coincide quite nicely with November’s election and could present Biden with an early opportunity to try and build bridges. Or it could deliver a re-elected Trump fresh ammunition for his ‘Make America Great Again’ campaign.

Oil and gas are going rapidly out of fashion, replaced instead by raw materials that go into electric car batteries and wind turbines, while rare earth elements for electronics are increasingly in demand.

At the beginning of September, the EU revealed its latest plan to build greater self-​sufficiency and resilience in the raw materials sector, by increasing domestic production and recycling capacity and cutting dependency on problematic foreign providers.

“We cannot afford to rely entirely on third countries – for some rare earths even on just one country,” said top EU official Thierry Breton, who explained that securing supplies of lithium, cobalt, strontium and more will be crucial for digital developments and green policies.

Yet the new focus on raw materials could bring the EU into conflict with the US in a new theatre of war, depending again on who is sitting in the Oval Office in 2021, as Washington has its own plans and the US is a top supplier for various crucial materials.

The EU procures valuable materials like hafnium, used in nuclear control rods, and beryllium, which has numerous electronic applications, from the US. Attempts to diversify suppliers could be met with suspicion across the pond.

A looming dispute over coronavirus vaccine doses could also emerge, given that Trump’s administration declined to join the global production and distribution COROVAX platform, citing the involvement of the World Health Organization as a stumbling block.

With most pharmaceutical companies signalling that a jab could be ready at the beginning of 2021, the race to get enough vaccine will come to a head during the first few months of the new US President’s term, again providing whichever man wins the opportunity to either embrace multilateralism or harden Washington’s isolationist streak.

Joe Biden’s presidency would not magically solve all the problems currently cooling transatlantic ties, but it would stand a good chance of improving them. November could be one of the most important months in recent history as a result.

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