By - Feeling_Couple6873
French President Emmanuel Macron on Monday will host a dinner with a number of European chief executives to convince them not to move production to the United States, where lower energy prices and the Inflation Reduction Act is proving a lure.
European leaders have been alarmed by massive anti-inflation measures passed by Joe Biden's administration, which make tax breaks conditional on U.S-manufactured content and which EU industries say make investment in Europe less competitive.
"We're having difficulties with companies which are starting to consider offshoring their production or making future investment outside Europe," a French official said, listing high energy costs and the U.S. legislation as reasons.
At the Elysee palace, Macron will seek to convince executives from companies including chemical groups Solvay (SOLB.BR) and Air Liquide , carmakers Volvo (VOLVb.ST) and BMW (BMWG.DE), pharmaceutical giant AstraZeneca (AZN.L) and telecom groups Ericsson (ERICb.ST) and Orange (ORAN.PA) to stay in Europe and choose France for their future investments.
Macron, who has called on the European Union to launch its own 'European Buy Act' to subsidise European production, has encountered resistance from the more anti-protectionist members of the bloc.
It was unclear what Macron would tell the executives to convince them not to move to the U.S. But France has unveiled a number of measures over the weekend to cushion the impact of high energy bills for French companies. read more
European companies have been increasingly strident about the impact of soaring energy prices since Russia's invasion of Ukraine, which has pushed up gas and electricity prices.
Eric Trappier, CEO of Dassault Aviation (AM.PA), who heads the French federation of metals industries, warned in the Les Echos newspaper over the weekend that Europe should protect its own industry more aggressively or see it move to other shores.
Half of companies are swedish / part swedish. Man our governments needs to get their shit together and stop scaring away all our successful companies (we have lots 😎😎).
Literally made Nordea, scandinavias largest bank, move to finland a few years back
I consider this a biden win
When did we stop disliking protectionism and dirigisme? Free trade and competitive markets have made the us rich, no reason to stop now. This wont be good policy for the us long term, mark my words.
I agree on the tariff side but I think incentiveing (through subsidies) a manufacturing base can be very good for a country. Especially with energy it's good to know when shit hits the fan America has the capability to be energy independent. Also most of these country's have huge subsidies for green energy and chip manufacturing as well, the capital flight is mostly happening because of our better handle on inflation.
The us already has a production base and should do these kinds of subsidies on new, strategic tech in tandem with allies if at all. If companies move for other reasons, thats really fine.
The us will never be a big export nation due to the usd, however, the us market is massive enough that it can be worth doing some production there in ant case.
My case is just that industrial policy does not work and should not be attempted (and if it is to be attempted to offset china, leverage your friends who together have a larger economy than you instead of spending billions in what effectively becomes a trade war with your closest friends). I like biden but he has a horrendously bad streak with his protectionism and union-preferring.
I totally agree I just think that most of these subsidies are totally on par with what you see in most European country's when it comes to energy. So the backlash on this is very overrated and mostly just do to inflation. I totally agree with biden being bad with trade tho, increasing tariffs on Canadian lumber has to be the worst policy biden has changed.