German Economy Minister Robert Habeck said he wants to strengthen the EU as a competitive location for investment and innovation, ahead of his trip to Stockholm on Thursday.
The important thing is to develop "leading green markets," said Habeck and spoke of a "green bridge across the Atlantic," in the transition towards a climate-friendly economy alongside the United States.
The EU has scrambled to respond to the US' inflation reduction act (IRA), a €346 billion ($367 billion) package passed by the US, part of which incentivizes the domestic manufacturing of clean energy. The bloc fears the legislation could cause EU-based companies to move overseas.
The IRA ensures tax credits for US consumers who purchase electric vehicles with batteries manufactured domestically and in certain countries with free trade agreements with the US. The EU and US are major trading partners, but have no such deal.
Habeck stressed however, that a trade dispute with the US could be avoided.
Climate and industrial policy are expected to be the focus of his two-day trip to Sweden.
The Scandinavian country's place in the discussion holds particular weight as it took over the rotating six-month EU presidency at the beginning of the year.
On the first day of his visit to Stockholm, Habeck is to hold political talks, among others with the Swedish energy minister.
Habeck's talks are likely to focus on the EU's "Fit for 55" climate package and the EU's response to a US subsidy programme.
European Commission President Ursula von der Leyen announced new recommendations on Wednesday for the EU to invest hundreds of billions of euros in climate-friendly technologies to strengthen Europe as an industrial location.
The industry is under pressure, not least because subsidies in countries like the US and China distort the conditions of competition, reiterated the commission's recommendations.
Habeck's visit also serves as preparation for his US trip starting in Washington on Monday. He is due to present the EU's position on the IRA to the US government together with his French counterpart Bruno Le Maire.
But first, Habeck plans to visit Swedish companies on Friday, such as the research site of the Swedish company Northvolt. The company is planning to build a battery cell factory for electric cars near Heide in the northern German state of Schleswig-Holstein.
However, Northvolt has signalled that the constructionof the factory could be delayed. The company cited local electricity prices and higher subsidies in the US as reasons.
