The tariffs on Chinese goods have been temporarily delayed as President Trump attempts to bypass a direct financial burden on American buyers prior to Christmas. Not so, tariffs on goods from the EU.
A complaint filed at the World Trade Organization under the Bush Administration finished its walk through the courts recently with a finding in favor of the United States. European Union nations were found to have provided improper financial subsidies for Airbus, clearing the way for retaliatory measures by the U.S.
A countersuit, alleging that the U.S. in turn provided illegal subsidies to Boeing, has not yet been adjudicated; a ruling on that case is expected in 2020. As that suit has presented evidence that the U.S.’s subsidies were greater than the amount Airbus received and the precedents have been set by the Airbus ruling, the allowed retaliatory tariffs for the EU are expected to be higher than the ones presented by the U.S.
For this reason, the EU has argued for continued negotiation on the subject. But given the green light on Monday by the international trade body to increase taxes, the Trump administration moved very quickly.
Prices for various items from Europe rise today, striking $7.5 billion in European goods.
The tariffs are protectionist measures on airplanes – 10% on Airbus, particularly desirable for American aircraft production following the Boeing 737-Max issues which have damaged Boeing’s sales – and efforts to increase prices for domestic agricultural products by taxing imports of European goods in the market.
Among the items hit will be French wines, Italian cheeses, Scotch and Irish Whiskies, and German meats and machinery.
EU representatives have indicated that, if the tariffs are enforced, they expect to retaliate to the maximum level which abides by WTO rules.
