The world trade organization (wto) has ruled that the United States will have the right to impose tariffs on about $7.5 billion worth of goods and services exported from the European Union (eu) to the United States each year because the eu and some of its member states have not fully implemented previous rulings by the wto's dispute settlement body.
Immediately after the ruling, the U.S. trade representative's office said it planned to impose tariffs on a range of European Union imports. The European Union was quick to say it could soon be empowered to retaliate against the U.S. Analysts say the threat of tariffs from both sides could exacerbate trade frictions.
The case is part of a long-running dispute between the United States and the European Union over airline subsidies. In 2004, the United States sued the world trade organization, accusing the European Union of providing illegal subsidies to airbus. The United States says the European Union is hurting Boeing by subsidizing large civilian airliners developed by airbus.
Subsequently, the European Union also sued the wto against the us government for providing illegal subsidies to Boeing. In 2012, the world trade organization ruled that U.S. subsidies to Boeing were illegal.
In May 2018, the wto appellate body confirmed that the "start-up support" and "member state financing" provided by the eu and some of its member states for airframes-related aircraft had harmed Boeing. In July 2018, the United States requested the resumption of arbitration proceedings. A recent wto arbitration report found that subsidies to airbus by the European Union and some of its member states hurt Boeing.
The U.S. government has requested a meeting of the world trade organization on Monday to formally authorize the United States to take retaliatory measures against eu products, the U.S. trade representative's office said in a statement. The U.S. trade representative's office plans to impose tariffs on a range of European Union imports, most of them from France, Germany, Spain and the U.K.
The us has decided to impose a 10 percent tariff on large civil aircraft and a 25 percent tariff on agricultural and other products from the eu, the statement said. The us has the right to further increase the additional tariffs or adjust the scope of the products affected by the additional tariffs at any time.
Eu trade commissioner malmstrom immediately issued a statement saying the U.S. decision to impose tariffs on the eu was' short-sighted 'and' counterproductive. ' She noted that the world trade organization has ruled that the United States also violated Boeing subsidies, and that the European Union may soon be empowered to retaliate against the United States. Tariffs between the us and Europe "would only hurt businesses and people on both sides of the Atlantic, as well as global trade and the wider aviation industry".
France's foreign ministry said that if the United States imposes tariffs on eu goods, the eu will resolutely retaliate against the United States and take retaliatory measures in accordance with the wto authorization to defend the interests of the eu.
The wto is scheduled to rule by early 2020 on a case brought by the European Union against the United States over subsidies to Boeing. The eu said it was prepared to impose tariffs on us imports thereafter. In march, the wto issued a report on the enforcement of Boeing subsidies, ruling that the U.S. was still subsidizing Boeing. According to relevant wto regulations, this decision provides the basis for the eu to take corresponding retaliatory measures against the us in the future.
A wto researcher at the institute of trade and economic integration at the institute for advanced international relations and development in Geneva, who asked not to be named, said the European Union had also called for retaliatory measures against the United States in its case against the United States. The tribunal is currently hearing whether the retaliatory measures proposed by the eu are in compliance, and is expected to have a decision in the first half of next year. The eu is expected to be able to retaliate against the us, but the exact amount has yet to be decided.
Mr Kim - he's - strauss - hall - reinfeldt's Geneva division international trade litigation law firm partner, Alan and Norwich is pointed out that trade retaliation is not the best choice, the United States and the European Union should seek to settle the dispute by does not destroy the world economy, a lot of innocent people will be hurt, the world economic situation also might be adversely affected as a result.