EU Sectors Affected by Transatlantic Aircraft Trade Disputes Call for Urgent De-escalation
Tariffs are causing irreparable damage amidst economic slowdown caused by COVID-19 crisis
Following the publication of the WTO report on the Boeing dispute earlier this week, 13 European associations representing sectors threatened or hit by US tariffs as part of the Airbus dispute have issued an urgent call on the EU and US to de-escalate the disputes, work on a negotiated solution and stop targeting sectors that are not directly related to the disputed aircraft subsidies. As a gesture of good will, the undersigned associations call on the US to suspend additional tariffs imposed on European products as part of the Airbus trade dispute and on the EU to refrain from imposing additional tariffs on US products, while negotiations are ongoing.
“All our sectors have been threatened or already hit by punitive tariffs for months, as part of a trade dispute over which we have no control and which is not related to us. In light of the economic slowdown caused by the COVID-19 crisis, worsened by recent restrictions and localised lockdowns across Europe, we can no longer afford to foot the bill for such unrelated disputes”, said the coalition. “While trade tensions between US and EU are complex, with serious issues on both sides, punitive tariffs cause irreparable harm to companies of all sizes and weaken their entire supply chains, at a time when growth and job creation are most needed”.
The lack of progress on a negotiated settlement is highly concerning for the undersigned associations, as is the potential threat of rapid escalation, at the detriment of sectors already suffering due to the global pandemic.
“We hope that the risk of further escalation will be avoided and that the voice of reason and moderation will prevail, on both sides of the Atlantic. Both sides need to realise that they have nothing to gain in continuing to fuel the negative cycle. The EU & the US should instead build on the good will generated by the tariff reduction agreement concluded in August and speed up work on a negotiated solution”, concluded the coalition.
The joint release was issued by the following trade associations: ACEM; AIJN; CAOBISCO; Cerame-Unie; CLITRAVI; EDA; EFFA; EPTA; EURATEX; FRUCOM; Intergraf; PROFEL; spiritsEUROPE
Notes to editor:
On 12 August 2020, the US published an updated list of EU products that will face additional tariffs from 1 September 2020, in retaliation for aircraft subsidies. USTR decided to maintain a 25% tariff on non-aircraft products. Changes were effective on 1 September 2020.
The USTR announcement from 12 August is available here: https://ustr.gov/about-us/policy-offices/press-office/press-releases/2020/august/ustr-modifies-75-billion-wto-award-implementation-relating-illegal-airbus-subsidies & the list of amendments and products impacted is available here: https://ustr.gov/sites/default/files/files/Press/Releases/FRN081220.pdf
On 13 October 2020, the WTO arbitrator issued its decision on the level of countermeasures the EU may request with respect to the US in relation to the Boeing case:
- WTO announcement: link
- Findings & conclusions: link
- Full decision by the arbitrator: link
- Updated dispute settlement summary: link
The arbitrator concluded that the EU may request authorisation from the DSB to take countermeasures with respect to the United States at a level not exceeding, in total, USD 3,993,212,564 annually. That’s the maximum amount the EU will be able to levy via tariffs on US goods.
About the signatories: open attached press release