EU to slap US with Boeing tariffs, but lauds Biden

This file photo taken on October 22, 2019 the Boeing logo is seen at its stand during the the 70th annual International Astronautical Congress at the Walter E. Washington Convention Center in Washington. The EU on November 9, 2020 said it is pushing ahead with up to $4 billion in tariffs against the US over illegal state aid to Boeing, the bloc's top trade official said.(MANDEL NGAN / AFP)

The decision is the latest twist in the 16-year trade battle over aircraft subsidies that turned increasingly sour under the protectionist instincts of US President Donald Trump.

Some had suggested Europe might delay the tit-for-tat levies after the victory of Biden, who is to replace Trump in January and is seen as more sympathetic to Europe and more of a multilateralist on trade.

"The US has imposed tariffs following the WTO ruling in the Airbus case," said the EU's top trade official, Valdis Dombrovskis ahead of a virtual EU trade ministers meeting.

"Now, we have a WTO ruling also in our Boeing case, allowing us to impose our tariffs and that's what we are doing," EU executive vice president Dombrovskis said.

Instead of hitting the pause button, Dombrovskis urged Washington to pursue a comprehensive deal on aviation subsidies worldwide to end the row.

"As it has been stated on numbers of occasions from the EU side, we're ready to suspend or withdraw our tariffs anytime when the US suspends or withdraws their tariffs," Dombrovskis said.

The decision merely "mirrored" the US decision to implement tariffs over Airbus a year ago, he added.

According to a list of targets seen by AFP, the EU is expected to impose tariffs on aircraft made in the United States, along with tractors, sweet potatoes, peanuts, frozen orange juice, tobacco, ketchup and Pacific salmon.

They are to take effect on Tuesday after being published in the EU's official journal later Monday.

- 'Second-class partners?' -

Dombrovskis, the former Latvian prime minister, spoke before the EU trade ministers discussed how Europeans can face up to challenges from both the US and China.

Reactions in Europe "have shown that there are great expectations after the election victory of Joe Biden," said German Economy Minister Peter Altmaier, an ally of Chancellor Angela Merkel.

"The hope is that the US will return to multilateral approaches, also in trade," added the minister, whose export powerhouse Germany was the most exposed to Trump's protectionist onslaught against Europe.

France, the EU's second biggest economy, has taken a tougher line against the US, refusing last year to sign off on an effort to pursue a mini-trade deal with Washington to placate Trump.

The tycoon president shocked Europeans early in his presidency by slapping tariffs on EU steel and aluminium, and constantly waved a threat of levies against Germany's world-leading auto industry.

US Trade Representative Robert E. Lighthizer said Washington was "disappointed by the action taken by the EU today.

"The alleged subsidy to Boeing was repealed seven months ago. The EU has long proclaimed its commitment to following WTO rules, but today’s announcement shows they do so only when convenient to them," he said.

"Europeans are united and determined to defend their interests," said French Trade Minister Franck Riester in an interview with the newspaper Les Echos, backing the Boeing tariffs.

They "must assert their trading power so that the United States does not see us as second-class partners but as their equals," he added.

Trump also battled France after it moved to introduce a digital tax on US tech giants, which he said were unfair against the US. Paris agreed to put its plan on hold.

The aviation feud predates Trump, but Washington quickly embraced the opportunity to impose $7.5 billion in tariffs against Europeans after being cleared to do so by the WTO.

Washington imposed punitive tariffs of 25 percent on iconic EU products such as wine, cheese and olive oil and put a 15-percent tariff on Airbus planes in March.