BRUSSELS — The European Union moved forward on Tuesday with a major clean-tech industrial plan that should not only keep the continent at the forefront of crafting a greener future, but also ensure their economic survival as it faces challenges from China and the United States.

The President of the European Commission, Ursula von der Leyen, presented the general lines of her «Industrial Green Deal Plan» that will greatly facilitate the boost subsidies for green industries and to bring together projects from across the EU that are boosted by significant funding as the EU pursues the goal of being climate neutral by 2050.

“We know we have a small window to invest in clean technology and innovation to gain leadership before the fossil fuel economy becomes obsolete,” von der Leyen said.

Von der Leyen used a speech in the World Economic Forum in Davos To say that in addition to fueling its own industry, the 27-nation bloc will become much more forceful in countering unfair trade practices, whether they come from Washington or, more importantly, Beijing.

“We see aggressive attempts to bring our industrial capabilities to China and elsewhere,” he said.

European Commission President Ursula von der Leyen delivers a speech at the World Economic Forum
European Commission President Ursula von der Leyen delivers a speech at the World Economic Forum in Davos, Switzerland on January 17, 2023.Markus Schreiber/AP

And because it’s trying to stop relying too much on Russian energy since the war in ukraine started almost a year ago, the EU does not want to become dependent on china for rare earth materialswhich are essential for the development of battery storage, hydrogen and wind power.

“We have a pressing need to make this net-zero transition without creating new dependencies,” von der Leyen said.

Von der Leyen’s scheme will now become the key driver for debate among EU member nations before its 27 leaders meet for a February 9-10 summit on the issue. Before such a plan becomes a reality, the EU needs to find a balance on the ability of economic giants like Germany and France to splurge on state aid and give funds to small member states, which do not have such firepower.

No specific numbers were mentioned, but as to what the US is putting into its $369 billion US Inflation Reduction Act and how the EU has already waved 672 billion euros ($727.5 billion ) to help enable member states to deal with the impact of the war in Ukraine, any commitment from the EU will be massive.

Many EU leaders viewed the US move as an attempt to squeeze European companies out of the lucrative US market for clean energy technology like electric vehicles and excessively favors a «made in America» ​​approach that discriminates against European multinationals.

In a letter to EU member states, European Commission Vice-President Margrethe Vestager wrote last week that the US plan “risks luring some of our EU companies into moving investments to the US.”

It underscores a continuing concern in the EU that it will become irrelevant in the economy of the future as the US and China suppress it.

“As a union, we are not living up to our full economic potential. Our productivity is lagging behind and fewer and fewer of the biggest companies on the planet are based in the EU,” said Swedish Prime Minister Ulf Kristersson.