EU to apply tariffs on US imports in Boeing case

The European Union said yesterday it is pushing ahead with tariffs against the United States as part of the long-running Boeing-Airbus row, despite hope for a trade truce with Joe Biden’s election.

The decision is the latest twist in the 16-year trade battle over aircraft subsidies that turned increasingly sour under the protectionist instincts of US President Donald Trump.

Some had suggested Europe might delay the tit-for-tat levies with the victory of Biden, who will replace Trump in January and is seen as more sympathetic to Europe and more of a multilateralist.

“The US has imposed tariffs following the WTO ruling in the Airbus case,” said the EU’s top trade official, Valdis Dombrovskis ahead of a virtual EU trade ministers meeting.

“Now, we have a WTO ruling also in our Boeing case, allowing us to impose our tariffs and that’s what we are doing,” the EU executive vice president said.

Instead of hitting the pause button, Dombrovskis urged Washington to pursue a comprehensive deal on aviation subsidies worldwide and to bring the row to a close.

“As it has been stated on numbers of occasions from the EU side, we’re ready to suspend or withdraw our tariffs anytime when the US suspends or withdraws their tariffs,” Dombrovskis said.

He spoke before the EU trade ministers were to discuss how Europeans can better face up to challenges from both the US and China.

Reactions in Europe “have shown that there are great expectations after the election victory of Joe Biden,” said German Economy Minister Peter Altmaier, an ally of Chancellor Angela Merkel. “The hope is that the US will return to multilateral approaches, also in trade,” added the minister, whose export powerhouse Germany was the most exposed to Trump’s protectionist onslaught against Europe.

The tycoon president shocked Europeans early in his presidency by slapping tariffs on EU steel and aluminium, and constantly waved a threat of levies against Germany’s world-leading auto industry.

Trump also came after France after it moved to introduce a digital tax on US tech giants, which he said were unfair against the US. Paris agreed to put its plan on hold.

The aviation feud long predates Trump, but Washington quickly embraced the opportunity to impose US$7.5 billion in tariffs against Europeans after being cleared to do so by the WTO.