US trade talks soon

Leroy Wright
April 13, 2019

U.S. President Donald Trump on Tuesday lashed out at the European Union, vowing to impose tariffs on billions in imports over subsidies to the aviation giant Airbus, suddenly escalating a transatlantic skirmish that is more than a decade old.

The WTO considers that European Union subsidies to Airbus (a civil aircraft manufacturer) adversely impacted the United States, which will now impose tariffs of 11 billion dollars on European Union products, Trump said on Twitter on Tuesday.

The WTO said previous year it would evaluate a US request to slap billions of dollars worth of sanctions on European products in response to a ruling that the EU had doled out the illegal subsidies to the aircraft giant. "It will soon stop!" The Airbus-Boeing fight also predates Trump and it's fair to say any USA administration would be willing to use WTO-sanctioned retaliatory tariffs. The EU has left most of its subsidies unchanged and launched additional aid since the challenge, USTR said.

Importantly, the U.S. has said it will wait for the WTO, which has already deemed the subsidies illegal, to rule this summer on the exact amount of retaliation allowed.

While the size of the tariffs is small compared with the hundreds of billions the US and China are taxing in their trade war, it suggests a breakdown in talks with the European Union over trade. From the U.S. case, it allows that the Office of the U.S. Trade Representative to collect public opinions on the prospective tariffs.

Both sides agreed that the size of the duties was subject to arbitration at the WTO, the result of which was expected in the summer.

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The commission said it is open to discussions with the United States on the matter, CNN reported.

These tariffs would be levied on selected goods imported from any of the 28 EU member states and would be in addition to the existing levies on European products.

The Trump administration's record of European goods to tax comprises the types of aircraft and trucks Airbus makes but also a vast array of European exports: famous cheeses like Stilton, Roquefort and Gouda, wines and oysters but also more obscure exports like ceramics, knives and pajamas. The EU reacted with tariffs about 2.8 billion euros' worth ($3.4 billion) of USA agricultural, steel and other products, from Harley Davidson bicycles to orange juice.

"There are already more than enough tariffs", he said. "Rather than the USA making further threats, both sides must now keep a cool mind and aim for de-escalation". In another instance, the WTO has ruled that Boeing got a small number of illegal support from the state of Washington worth a $100 million a year.

Shares of Airbus were dealing 2.3 percent lesser after the tariffs were advanced.

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