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US firms warned against possible negative implications of the high-level report published last week by former European Central Bank President Mario Draghi on Monday (16 September) – arguing that certain recommendations would unfairly discriminate against non-European companies.

Despite praising Draghi’s “important contribution” to the discussion surrounding Europe’s flagging competitiveness, the American Chamber of Commerce to the EU (AmCham EU) cautioned that an overarching strive to prioritise European firms would endanger the bloc’s ability to leverage bilateral investments and trade flows.

“Making Europe more competitive does not require the region to turn its back on its long-standing commitment to openness,” the association warned.

“[US] companies are woven into the fabric of the EU economy, committed to building on their legacy of strengthening the region’s Single Market and industrial base,” it went on to say, highlighting the “€3.5 trillion of US foreign direct investment” (FDI) that goes to the 27 member states.

Meanwhile, total EU-US trade in goods surpassed over €850 billion last year – making for the world’s largest trade and investment relationship by far, well above the €520 billion US-China trade in goods and the €738 billion in total EU-China goods trade.

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Draghi’s warnings against both blocs [China, U.S.] “actively pursuing policies to enhance their competitive positions” largely echoed widespread European industry worries around, in the case of the US, the Inflation Reduction Act (IRA) signed by President Joe Biden in 2022 – a massive green subsidy programme that has been seen to create market distortions and unduly favour US-based growth. Draghi has sharply criticised both Chinese and US protectionist policies in recent months, accusing both of “no longer playing by the rules” on international trade, through their increasing use of tariffs, subsidies, and other non-market policies.

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Draghi, however, suggested in his report that EU defence-related public tenders should ensure that “a minimum share” of the increasing global demand for weaponry “is concentrated on European companies rather than flowing overseas” – something that echoes the EDIP text and that AmCham warned “would not address European security needs in the near term”.