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German Chancellor Scholz Confident EU Will Avoid US Trade War Over Green Subsidies

  • Germany ‘working very hard’ to avoid escalation of dispute
  • Chancellor optimistic agreement can be reached between allies
Olaf Scholz, Germany's chancellor, during a Bloomberg Television interview in Berlin.
Olaf Scholz, Germany's chancellor, during a Bloomberg Television interview in Berlin.Photographer: Jacobia Dahm/Bloomberg

German Chancellor Olaf Scholz said he’s convinced that a trade war can be avoided between the European Union and the US over a recent package of green subsidies introduced by Joe Biden’s administration.

Some of Washington’s allies have been angered by Biden’s climate-friendly tax law, known as the Inflation Reduction Act, even though it’s dedicated to boosting green tech and promoting a carbon-neutral future. They’re unhappy about subsidies which they say favor American firms and put their EU rivals at a disadvantage.