Dhe EU and the United States are suspending the punitive tariffs imposed in the dispute over subsidies for Airbus and Boeing. Both sides had agreed to suspend the tariffs for four months initially in order to find a solution to the conflict that has been smoldering for years, said Commission President Ursula von der Leyen on Friday after a phone call with the new American President Joe Biden. The Washington White House issued a similar statement.
Von der Leyen was quoted as saying that the decision was a “symbol of a new start” in transatlantic relations. The day before, the two trade representatives from Great Britain and the United States had agreed on the same procedure. Trade Commissioner Valdis Dombrovskis had recently offered Biden in an interview with the FAZ to leave the conflict behind and work on “how we want to shape the promotion of civil aircraft manufacturers in the future”. It is also about China.
The World Trade Organization (WTO) has decided several times in recent years that Airbus and Boeing are being illegally subsidized with billions of dollars. In 2019, the WTO approved punitive tariffs for the Americans on EU imports of $ 7.5 billion annually. In 2020 it allowed the EU to import tariffs of 4 billion dollars (3.4 billion euros).
Tariffs not just since Trump
The EU put its punitive tariffs into effect in the autumn after Biden’s election. This had been interpreted to mean that those responsible in the EU were not sure that the trade policy stance of the United States would change under Biden. In fact, it was attentively noted that Biden reversed many of his predecessor Donald Trump’s decisions immediately after taking office, but did not suspend tariffs against the EU. In addition to the punitive tariffs in the Airbus-Boeing dispute, these are also tariffs that the Americans under Trump had imposed on the import of steel and aluminum. The EU had offered Biden to suspend the tariffs for half a year in both cases.
In addition to ketchup and tractors, the European import tariffs in the Airbus-Boeing conflict also affect cranberries, nuts, tobacco products, rum, vodka and game consoles. In addition, shovel loaders and aircraft are on the EU’s punitive tariff list. The punitive tariff on aircraft is 15 percent, and that on all other products is 25 percent. In addition to aircraft, the American punitive tariffs affect wine from Germany and France, Parmesan from Italy and olive oil from Spain.
The American side had taken the position that it had abolished tax breaks for the production of aircraft in good time and that EU tariffs were not justified because of state support for Boeing. Under Trump, the Americans had demanded that the EU repay the aid it had paid to Airbus before negotiations could begin. There is no longer any question of that. The conflict over illegal subsidies for aircraft manufacturers is old and cannot be traced back to the protectionist trade policy under Donald Trump.