The European Union will be able to impose tariffs on $4.000 billion of American goods in response to subsidies granted by Washington to the aircraft manufacturer Boeing, after having been granted this right in a failure of the World Trade Organization (WTO) made public on Tuesday (13.10.2020).
The decision threatens to stoke trade tensions on both sides of the Atlantic three weeks before the November 3 presidential election, but could also help resolve a 16-year legal battle, the two countries' top negotiators say.
Both the US and the EU have shown interest in resolving the dispute over subsidies each provided to their respective aircraft manufacturers, Boeing and Airbus, while accusing each other of not wanting to sit down and negotiate the matter seriously.
Tuesday's decision, delayed by the COVID-19 pandemic and first reported by Reuters on Sept. 30, follows a WTO ruling last year allowing Washington to impose tariffs on $7.500 billion of EU goods over state support given to Airbus, which has headquarters in Britain, France, Germany and Spain.
Combined, the two cases make up the largest corporate trade dispute in history.
Washington has since moved to revoke tax breaks that benefited Boeing, while Airbus has announced it will increase loan repayments for A350 aircraft to France and Spain in an attempt to resolve the matter.
The European Commission has said it would prefer a negotiated solution, but would impose tariffs if one is not reached.
He has already drawn up a lengthy list of US products on which he could impose tariffs, including wine, liquor, suitcases, tractors, frozen fish and a range of agricultural products from dried onions to cherries.
European sources have said the EU could also add tariffs on another $4.000 billion of US goods left over from an earlier WTO case, giving it similar firepower to what Washington got with last year's WTO ruling.
Source: Reuters
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