US ambassador Caroline Kennedy has challenged jurisdictions like Australia and Europe to match and “beat” President Joe Biden’s vast subsidy-driven decarbonisation strategy and rejected concerns America’s efforts will undermine the competitiveness of trading partners.

Speaking as a growing number of corporate chiefs warn Australia needs to respond to the potentially distortionary cross-border consequences of the $US369 billion ($547 billion) US Inflation Reduction Act, Ms Kennedy insisted the policy should be seen as something to emulate and that Australia will be a huge beneficiary given the need for critical minerals.