US Threatens To Slap On With New Tariffs On EU Products

Us trade war with EU

The US is set with an alarm for European Unions to increase the tariffs on their EU products. This major step taken down by the USA is in retaliation against European Airbus subsidiaries. The European Union and the USA have been battling over the aircraft subsidiaries for more than a decade and other feuds at the World Trade Organization.

President’s Donald Trump administration said that it will impose tariffs of $11 Billion in imports due to the subsidiaries by Air Bus. The European Union counterattacks the country by telling the numbers are “greatly exaggerated” The amount is less than .1% of EU GDP but it can increase the tension further.

Trade War Between USA And EU

In a statement, The United States Representative Robert Lighthizer said, the World Trade Organization (WTO) had repeatedly found that European subsidies to Airbus have caused adverse effects to the United States. “This case has been in litigation for 14 years, and the time has come for action,” he added. The USTR proposed a list of extended 14 EU products that will be a part of the elevated tariffs. It ranges from large commercial aircraft and parts, daily dairy products, motorcycles, and wine. Both of them has been paying billions of dollars of subsidies to dominate the global jet business.

“Our ultimate goal is to reach an agreement with the EU to end all WTO-inconsistent subsidies to large civil aircraft. When the EU ends these harmful subsidies, the additional US duties imposed in response can be lifted.” Representative added. In March 2012, WTO has said to the USA that billions of dollars of subsidies of Boeing is illegal and stated them to end them. After a few months, the European Union filed a complaint alleging that they are not complying the order. In the ruling of 2017, WTO said that the USA has compiled 28 out of 29 programmes. But agreed to Brussels that the USA had not taken “appropriate steps to remove the adverse effects or… withdraw the subsidy” in the case of Washington state.

“It’s in the interests of the U.S. and the EU to find a friendly accord on the issue of penalties in the airplane sector,” French Finance Minister Bruno Le Maire told reporters in Paris on Tuesday. “When I see slowing world growth, I don’t think that we can afford a trade war, even if it’s just in one industrial sector.”

Trade War With China

If compared to a trade war with the EU, it is relatively minor if compared to the ongoing tension on tariffs by both sides. Both of the countries have imposed $360 Billion of tariffs on each other’s goods. Beijing has had retaliated the USA with tariffs of $110 Billion. It has accused the USA of starting “the largest trade war in economic history”. This all imposed tariffs were deployed in the last nine months. Both of the countries have come to halt to have a talk over the escalating issue.

The International Monetary Fund says that the continuation of trade war can weaken the global economy.


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