EU-US Subsidy Race Heralds Protectionist Era

Welcome to the Brussels Edition, Bloomberg’s daily briefing on what matters most in the heart of the European Union.

The EU will start fine-tuning its response to Joe Biden’s $500 billion clean-tech law this week. Ministers will have a first look at the Commission’s green industrial package tomorrow in Stockholm before leaders try to narrow their differences over proposed state-aid changes and funding needs later this week at their Brussels summit. The renewed subsidy race with the US risks dealing a critical blow to the global trade system. To avoid further damage, the Commission will submit a proposal to the World Trade Organization to allow for some green subsidies to mitigate climate change, we’re told. But the next WTO ministerial meeting isn’t until next year and any changes would require consensus among its 164 members.