USTR proposes $4 billion in potential additional tariffs over EU aircraft subsidies

[Eugene]

Source: Reuters

BUSINESS NEWS JULY 1, 2019 / 6:47 PM / UPDATED AN HOUR AGO

USTR proposes $4 billion in potential additional tariffs over EU aircraft subsidies

Andrea Shalal
3 MIN READ

WASHINGTON (Reuters) - Just days after reaching a truce in the U.S.-China trade war, the U.S. government on Monday ratcheted up pressure on Europe in a long-running dispute over aircraft subsidies, threatening tariffs on $4 billion of additional EU goods.

The U.S. Trade Representative’s office released a list of additional products - including olives, Italian cheese and Scotch whiskey - that could be hit with tariffs, on top of products worth $21 billion that were announced in April.

USTR said it was adding 89 tariff sub-categories to its initial list, including a variety of metals, in response to public comments, but gave no further explanation. Over 40 individuals testified about products included on the initial list at a public hearing on May 15 and 16.

The United States and the EU have threatened to impose billions of dollars of tit-for-tat tariffs on planes, tractors and food in a nearly 15-year dispute at the World Trade Organization over aircraft subsidies given to U.S. planemaker Boeing Co (BA.N) and its European rival, Airbus SE (AIR.PA).

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Read more: https://www.reuters.com/article/us-usa-trade-eu/ustr-proposes-4-billion-in-potential-additional-tariffs-over-eu-aircraft-subsidies-idUSKCN1TW3ZR

[sandensea]

1. This helps explains the EU's sudden rush to sign a (tentative) trade deal with Mercosur

They're counting on the Mercosur market (almost 300 million people, including Venezuela) to absorb some of the slack going forward.

Of course though, that's if it's ratified.

And that's doubtful, both on the EU side (there's strong opposition to it in the EU Parliament due to concerns over Brazil's low labor costs) and Mercosur (mainly in Argentina, which would have the most to lose).