When the Presidents of the EU’s two main institutions welcomed US President Joe Biden in the Council’s egg-shaped Europa building, it was immediately clear to observers that, while the difficulties of the past four years had not been forgotten, all signs pointed to a softening of the transatlantic relationship.
Following the rocky and often openly acrimonious relationship between the Trump Administration and the European Union, President Biden’s overarching objective for his trip to Brussels was to reconfirm his commitment to the success of the European project and the rebuilding of close transatlantic economic ties. Particularly in light of China’s increasing economic might and hegemony, he declared that “it is overwhelmingly in the interest of the United States to have a great relationship with the EU – which is very different to my predecessor.”
It was a statement clearly enjoyed by European Council Charles Michel and European Commission President Ursula von der Leyen, with the latter recalling that “the last four years have not been easy,” before adding that “the world has changes, Europe has changed.”
In fact, for a US Administration to looking to reassert its power and influence in the halls of Brussels’ powerbrokers, the simple “Europe has changed” comment also masks the many topics EU leaders do not see themselves eye to eye with Washington. While the two did announce a temporary, 5-year truce in their WTO-level subsidies fight around Boeing and Airbus, deep disputes continue to run from Donald Trump’s steel and aluminium tariffs to digital taxation, tackling climate change, and tech oversight and regulation.
Indeed, while the EU’s political leadership jokingly welcomed the reassurances that “the EU is no security threat to the US,” they had to accept Biden’s decision to keep the current import levies, based on exactly that security threat argument, in place for the time being. While difficult to justify, they simply remain too popular in the US’ rustbelt whose votes his Democratic party badly need in next year’s midterm election.
On climate change, while the leaders committed to establishing an EU-US High-Level Climate Action Group, make “every effort to keep a 1.5-degree limit on global temperature within reach” and to “further accelerate the transition away from unabated coal capacity” any clear targets or actions remained amiss. This also because the new US Administration is only the infant stages of preparing sweeping climate change legislation, while the EU has already passed a climate law and will put forward a set of progressive and transformative legislative amendments next month. Meanwhile, deep differences remain over an effective way of carbon pricing and the President von der Leyen’s plans for a carbon border adjustment mechanism.
Yet, the deepest divergences remain on how to oversee and regulate (predominantly US-based) technology companies. It is here, where “Europe has changed” the most over the last four years, looking to once again assert itself as the global regulatory superpower. In this regard, EU plans to tax digital companies and the EU institution’s current work on the Digital Services and Digital Markets Acts are set to create a significant new framework for how tech companies can operate in the European Union.
It also follows the repeated invalidation of transatlantic data sharing agreements by the European Court of Justice over US national security agencies’ ability to access EU citizens data without their knowledge and consent.
Compliments of Vulcan Consulting – a member of the EACCNY.