EU internal markets commissioner Thierry Breton said this week it was clear that both the United States and China were seeking to attract industrial capacity away from Europe and so make Europe dependent on their industries in future: "Or to put it more bluntly - they are engaged in a subsidies race. Not us; them."
The supply of minerals vital for the green transition is a further challenge, with China processing almost 90% of rare earths and 60% of lithium, a key element for batteries. On the former, the EU executive will propose legislation on Tuesday enabling the region to mine 10% of the strategic raw materials it consumes and increase processing to 40% of its needs by 2030.
Then there is the thorny question of subsidies and a possible future European Sovereignty Fund, an idea first raised by European Commission President Ursula von der Leyen last year. Breton argues the sovereignty fund would help ensure a level playing field between EU countries that do not have the same ability to provide state aid, with financing through joint borrowing.