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EU threatens escalation in tariff fight over Boeing and Airbus subsidies

Airbus A350-1000 aircraft

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Getty Images

The EU has threatened to escalate a 15-year row with the US over aircraft subsidies for Airbus and Boeing unless Washington agrees to a settlement.

The EU and US have accused each other of propping up their home aviation markets with tax breaks, research grants and other aid.

Europe’s trade commissioner said Washington has rejected moves to settle the dispute.

It comes as the US threatens tariffs on EU beer, gin and olives.

The US last month said it was considering duties on 30 products worth $3.1bn (£2.5bn) in trade every year.

It has already put 15% to 25% tariffs on $7.5bn worth of other EU goods as part of the dispute.

The EU warned it would damage firms on both side of the Atlantic.

European Trade Commissioner Phil Hogan told the European Parliament’s trade committee: “I want to reassure people that we are ready to act decisively and strongly on the European Union side if we don’t get the type of outcome that we expect from the United States in relationship to finalising this 15-year-old dispute.”

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Reuters

Image caption

European Trade Commissioner Phil Hogan said the EU will act “decisively and strongly”

The dispute – which dates back to 2004 – is being overseen by the World Trade Organisation. It ruled that the US could impose $7.5bn of duties on European goods.

A ruling is due in September on how much in duties the EU can levy on US products.

Mr Hogan also criticised recent national security investigations the US launched against EU goods, seen by the EU as a further retaliation.

The investigations, known as 232 investigations, cover products from transformers and mobile cranes to steel nails.

“It’s not appreciated the number of 232 investigations that have been launched in recent weeks, perhaps this is political, perhaps it’s more real,” Mr Hogan said.

“This is totally unacceptable,” he said. “If these investigations go further the European Union will have to stand together and act as well.”

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