US moves to put new tariffs on $11.2 bn worth of EU imports
London: The United States wants to put tariffs on $11.2 billion worth of EU goods from airplanes to Gouda cheese to olives to offset what it says are unfair European subsidies for plane maker Airbus.
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 at a time when the economy is already slowing sharply. The US and EU have been negotiating since last year about how to avoid tariffs that President Donald Trump has wanted to impose to reduce a trade deficit with countries like Germany. The US Trade Representative's office released late Monday a list of EU products it would tax in anticipation of a ruling by the World Trade Organization this summer.
The US had in 2004 complained to the WTO, which sets the rules for trade and settles disputes, that the EU was providing unfair support to Airbus. The WTO ruled in May last year that the EU had in fact provided some illegal subsidies to Airbus, hurting US manufacturer Boeing. The US expects the WTO will say this summer that it can take countermeasures to offset the EU subsidies. It will now start a consultation with industry representatives on the list of EU goods it wants to tax so that it can have a ready list.
"This case has been in litigation for 14 years, and the time has come for action," said US Trade Representative Robert Lighthizer. The move, while nominally following international trade rules, appears to also reflect US frustration at the slow pace of talks on trade with the EU.