Trump Threatens Europe with More Tarrifs
Trump has threatened to put import tariffs on a multitude of goods coming from Europe. The list includes helicopters, clothing, wine, and cheese.
EU Support for Airbus Doesn’t Fly with Trump
The main reason for the tariff threat is the subsidies Airbus has received from the EU. Airbus is the main competitor of the largest American airplane builder Boeing. The Office of the United States Trade Representative (USTR) has started creating a list of products that the EU exports to the United States to which additional duties may be applied until the EU removes those subsidies,
In a recent press release, the USTR states:
The World Trade Organization (WTO) has found repeatedly that European Union (EU) subsidies to Airbus have caused adverse effects to the United States… USTR is releasing for public comment a preliminary list of EU products to be covered by additional duties. USTR estimates the harm from the EU subsidies as $11 billion in trade each year.
“This case has been in litigation for 14 years, and the time has come for action. The Administration is preparing to respond immediately when the WTO issues its finding on the value of U.S. countermeasures,” said U.S. Trade Representative Robert Lighthizer. “Our ultimate goal is to reach an agreement with the EU to end all WTO-inconsistent subsidies to large civil aircraft. When the EU ends these harmful subsidies, the additional U.S. duties imposed in response can be lifted.”
Read the full press release here.
Plane Crashes and a Trade War
Is it a coincidence that the statement comes now that the pressure on Boeing is mounting due to the recent crashes of its 737-MAX aircraft? The tariffs would be added to the ones already in place since Trump started the US-EU trade war last year, with tariffs on steel and aluminum. The reason back then was tariffs on American cars, and now it’s American planes.
Are Your Products on the List?
Trump has threatened before and doesn’t always follow through, so we will have to wait and see what will happen next. If you are wondering if your products will be hit by the higher tariffs, you can check the full list of goods under threat here.