US proposes $5.4b in tariffs on EU goods over aircraft subsidies

For more than 14 years, Washington and Brussels have accused each other of unfairly subsidising aviation giants Boeing (pictured) and Airbus.
For more than 14 years, Washington and Brussels have accused each other of unfairly subsidising aviation giants Boeing (pictured) and Airbus.PHOTO: AFP

WASHINGTON • The United States on Monday proposed US$4 billion (S$5.4 billion) in tariffs on a range of European Union products - including Parmesan cheese and Scotch and Irish whiskey - over subsidies for commercial aircraft.

The list also includes sausages, ham, pasta, olives and many other cheeses including reggiano, provolone, edam and gouda.

"Today, the Office of the US Trade Representative is issuing for public comment a supplemental list of products that could potentially be subject to additional duties," it said in a statement.

The potential tariffs are due to "EU subsidies on large civil aircraft", the statement said.

"This supplemental list adds 89 tariff subheadings with an approximate trade value of US$4 billion to the initial list published on April 12, which included tariff subheadings with an approximate trade value of US$21 billion," it added.

For more than 14 years, Washington and Brussels have accused each other of unfairly subsidising aviation giants Boeing and Airbus, respectively, in a tit-for-tat dispute that long predates US President Donald Trump's time in office.

The Boeing-Airbus spat is the longest and most complicated dispute handled by the World Trade Organisation, which aims to create a level playing field in global trade.

 
 
 

Senior officials from Boeing and a US aerospace trade group urged the US government last month to narrowly tailor any tariffs imposed on the EU over illegal aircraft subsidies to avoid harming American manufacturers.

No comment was immediately available from Boeing or Airbus.

The Distilled Spirits Council of the United States criticised the Trump administration's latest tariff threats and warned they would jeopardise US jobs and hurt consumers.

"We strongly oppose the inclusion of distilled products in the proposed retaliation list," said spokesman Lisa Hawkins.

"US companies - from farmers to suppliers to retailers - are already being negatively impacted by the imposition of retaliatory tariffs by key trading partners on certain US distilled spirits... and these additional tariffs will only inflict further harm," she said.

A version of this article appeared in the print edition of The Straits Times on July 03, 2019, with the headline 'US proposes $5.4b in tariffs on EU goods over aircraft subsidies'. Print Edition | Subscribe