US slaps tariffs on French, German wines and plane parts amid EU row

The aviation feud is the longest and most complicated ever handled by the WTO.
The aviation feud is the longest and most complicated ever handled by the WTO.PHOTO: AFP

WASHINGTON • The US government has said it would raise tariffs on certain European Union products, including aircraft components and wines from France and Germany, the latest twist in a 16-year battle over aircraft subsidies between Washington and Brussels.

In a statement on Wednesday, the Office of the US Trade Representative (USTR) said it was adding tariffs on aircraft manufacturing parts and certain non-sparkling wines as well as cognacs and other brandies from France and Germany.

The USTR did not say when the tariffs would take effect but noted that additional details would be "forthcoming." The US action comes as US and European negotiators continue talks on ending the long-running dispute over government aid to Europe's Airbus, which is politically backed by Britain, France, Germany and Spain, and US aid plane maker Boeing.

The USTR said on Wednesday the EU had unfairly calculated tariffs against the United States allowed by a September World Trade Organisation (WTO) ruling in the ongoing dispute. "The EU needs to take some measure to compensate for this unfairness," it said.

Representatives for the European Union and Airbus could not be immediately reached for comment on the USTR action.

Mr Ben Aneff, president of the US Wine Trade Alliance, said the action would cause further hardship for US companies already hit hard by previous tariffs, and urged President-elect Joe Biden to quickly reverse course. "This action is a body blow for American companies. US restaurants and small businesses are already struggling to survive; this decision will only destroy more jobs and shutter more doors," he said.

Ms Emily Haber, Germany's Ambassador to the US, this month urged quick action to resolve the dispute, calling it a distraction from bigger issues that require joint action such as climate change and the pandemic.

The aviation feud is the longest and most complicated ever handled by the WTO.

Washington quickly embraced the opportunity to impose US$7.5 billion (S$9.9 billion) in tariffs against Europeans after being cleared to do so by the WTO last year. It imposed punitive tariffs of 25 per cent on products such as wine, cheese and olive oil and put a 15 percent tariff on Airbus planes in March. In retaliation, the EU has been imposing customs duties on US$4 billion of American exports since the beginning of November.

REUTERS, AGENCE FRANCE-PRESSE

A version of this article appeared in the print edition of The Straits Times on January 01, 2021, with the headline 'US slaps tariffs on French, German wines and plane parts amid EU row'. Subscribe