Seven European Union member states from the bloc's north and east have sent a letter to European Commission Vice President Valdis Dombrovskis warning against a subsidy race with the United States, the Czech Finance Ministry said Tuesday.
The ministry confirmed information from Der Spiegel magazine that the finance ministers of Estonia, Finland, Austria, Ireland, the Czech Republic, Denmark and Slovakia sent a letter to Dombrovskis saying that too much financial support for companies, not justified by clear market failures, could lead to a dangerous subsidy race.
Czech Finance Minister Zbyněk Stanjura also said it would be wrong to start a trade war with the United States.
Introducing retaliatory protectionist measures would threaten the fiscal stability of EU countries and lead to domestic market disruption, Stanjura tweeted.
In December, the EU said it would adapt its state aid rules to prevent investment outflows triggered by the U.S. Inflation Reduction Act, which it fears could poach businesses from the EU and put European companies at a disadvantage, Reuters reported.