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US-EU almost agreement on Boeing-Airbus trade struggle

The United States and the European Union are approaching an agreement to suspend trade disputes over government subsidies for Boeing.

Airbus SE,

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As a sign of alleviating trade tensions, EU top executives said.

European Commission President Ursula von der Leyen said on Tuesday that he was “very positive and confident” that the deal would be announced that day. “Resolving it is our common interest,” she said of the controversy.

The longest and most costly 17-year trade struggle resolution in the history of the World Trade Organization will significantly ease trade tensions between two huge and deeply linked economies.

Apart from the transatlantic differences on this issue, allies can jointly focus on China, which has been heavily subsidized to develop large airliners.

China faces the challenge of catching up with Boeing and Airbus, both of which are large commercial for large-scale sales of Chinese-made airliners in the world’s most populous countries and other countries in Beijing’s economic trajectory. I am concerned that it poses a threat. China currently accounts for a quarter of aircraft deliveries.

Both sides agreed in March 4 months suspension of tariffs With a variety of products such as aircraft and wine and whiskey, we are trying to close deals and improve tense bilateral relations.

For the two plane makers, the deal that many customers don’t want or can’t use a new jet, wrestling with the pandemic-induced air travel stagnation, happens at a crucial time.

Boeing is also deciding whether to launch a new airliner. Much of the long-standing controversy has to do with government financing, contracts, and support for other cleansheet aircraft.

Both sides have agreed to suspend tariffs related to complaints from both sides filed with the World Trade Organization. The suspension reflects the easing of trade tensions between Washington and its trading partners, following the aggressive trade policy of former President Donald Trump, who claimed that global trading partners had long used the United States.

Biden said he would like to work closely with his allies, and U.S. Trade Representative Katherine Tai said. Her confirmation hearing She was keen on resolving aircraft disputes.

The US-EU freeze was accompanied by similar arrangements between the United States and the United Kingdom, both of which suspended retaliatory tariffs on aircraft disputes for four months.

The dispute between Airbus and Boeing began in 2004 when the United States filed a complaint with the WTO, claiming that EU subsidies to Airbus put Boeing at a disadvantage. Under the Trump administration, the dispute turned into a tariff dispute that cursed the food and beverage industry unrelated to aircraft manufacturing. Washington imposed tariffs on European wines and foods worth $ 7.5 billion in late 2019.

The EU has counterattacked with a tax on American whiskey, nuts and tobacco worth about $ 4.5 billion. The United States tightened sanctions on December 31 with additional tariffs, placing virtually all wine imports from France and Germany under a 25% tariff.

In the aircraft manufacturing industry, jet airliner deliveries are well below pre-pandemic levels as underfunded airlines postpone or cancel orders due to reduced travel demand. However, some customers say that tariffs (and who pays them) are still a constraint on the number of deliveries.

Delta Air Lines Of a corporation

The expansion of the Airbus fleet has made it one of the most affected US aircraft carriers by EU action.

Ryanair Holdings

PLC’s scheduled delivery schedule for the Boeing 737 MAX has become the most exposed European airline of the year. Ryanair is still waiting for the first MAX due to quality issues that Boeing was forced to suspend delivery.

The carrier does not reveal whether they or the manufacturer have previously paid the fee.

Write to Daniel Michaels daniel.michaels@wsj.com And with Doug Cameron doug.cameron@wsj.com

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US-EU almost agreement on Boeing-Airbus trade struggle

Source link US-EU almost agreement on Boeing-Airbus trade struggle

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