Sunak to raise concerns about Biden’s green subsidies

PM talks up anti-protectionist agenda ahead of meeting – insisting subsidy races are ‘zero sum’ game

Adam Forrest
Political Correspondent
Wednesday 07 June 2023 08:09 BST
Rishi Sunak holds a huddle with political journalists on plane heading to US
Rishi Sunak holds a huddle with political journalists on plane heading to US (PA)

Rishi Sunak will raise his concerns about Joe Biden’s green subsidy plan when the pair meet in Washington for talks on Thursday.

The prime minister arrived in the US for two days of meetings with business leaders and senior politicians, culminating in discussions with the US president at the White House.

He will seek greater economic co-operation with the US, push for the UK to be at the centre of artificial intelligence (AI) regulation, and share unease over green tech subsidies.

Senior members of Mr Sunak’s government have criticised Mr Biden’s Inflation Reduction Act – a massive package of tax breaks and subsidies aimed at boosting green industries in the US – as “protectionist” and distorting.

Asked by reporters whether the Biden administration was being protectionist, Mr Sunak said the recent G7 communique “makes it very clear that G7 countries don’t believe in protectionism as the answer to this challenge and also don’t believe in subsidy races that are zero sum”.

Energy secretary Grant Shapps has said government was working with the US to smooth over “rough edges” of the green subsidy plan which could hit British firms seeking to trade across the Atlantic, but difficulties still remain.

Mr Sunak told reporters travelling with him to the US: “It’s something that he [Mr Biden] and I have discussed in the past and you’d expect us to continue discussing it.”

But the PM said it was “good for the world” that the US and others want to cut emissions. “All countries are going to invest in making sure they can make the transition to net zero. We’ve got a head start over everybody because we decarbonised faster than any other G7 economy,” he said.

Mr Sunak said hopes to establish a world of “economic interoperability” allowing Western allies to work together in the way militaries do as part of Nato.

Rishi Sunak set to meet president Joe Biden (PA Wire)

Meanwhile, Mr Sunak said the destruction of the Kakhovka dam in Ukraine would mark a “new low” in the conflict if Russian forces were found to be responsible.

Saying it was “too soon” to come to a judgement, he said: “But what I can say is if it is intentional, it would represent, I think, the largest attack on civilian infrastructure in Ukraine since the start of the war, and just would demonstrate the new lows that we would have seen from Russian aggression.”

On Wednesday Mr Sunak will hold talks with senior figures in Congress before attending a baseball match – although he will not throw the ceremonial first pitch. Mr Sunak had been expected to throw the ball, but No 10 has reportedly decided against it.

But the PM insisted: “I wasn’t actually meant to ever do it. Who is doing it is a veteran, a great UK veteran … who’s going to be fantastic.” He added: “As you guys know, my sport is more cricket than baseball in any case.”

One of the other key issues on the agenda for the US visit will be AI. With the US and EU considering measures to regulate AI, Mr Sunak wants to make sure the UK’s voice is also heard.

Despite the danger of being shut out from conversations between the two main Western economic powers – the US and EU – the Sunak government believes that the post-Brexit break from Brussels gives it greater freedom to act quickly.

Mr Sunak, who is staying at the president’s guest house Blair House during the trip, will also push for greater business links with the US, although hopes of a full free-trade agreement have been shelved. The trip will see him address the Business Roundtable forum of leading CEOs on Thursday.

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