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US dried fruit, wine and tomato ketchup could be hit with new EU import tariffs

Ongoing WTO trade dispute over aircraft subsidies could see both EU and US apply additional tariffs on food and drink products, including dairy, fruit juices, nuts and seafood

US food and drink products could be hit with additional import duties by the European Union, as a trade dispute between the two markets over aircraft subsidies escalates.

The European Commission announced today (April 17) a preliminary list of products, the majority of which are food and drink, on which the bloc may take counter measures due to the WTO Appellate Body ruling of March 28 that determined United States subsidies to Boeing continue to cause harm to EU aircraft manufacturer Airbus.

The move comes a week after the US Trade Representative presented a list of EU products that it will target for new import taxes unless the bloc ceases to provide Airbus with subsidies.

Like the US announcement, the EU said it would gather feedback from stakeholders and wait for a WTO-appointed arbitrator to determine the exact appropriate level of countermeasures in value terms.

“European companies must be able to compete on fair and equal terms. The recent WTO ruling on U.S. subsidies for Boeing is important in this respect,” EU Trade Commissioner Cecilia Malmström said.

“We must continue to defend a level-playing field for our industry. But let me be clear, we do not want a tit-for-tat. While we need to be ready with countermeasures in case there is no other way out, I still believe that dialogue is what should prevail between important partners such as the EU and the U.S., including in bringing an end to this long-standing dispute. The EU remains open for discussions with the U.S., provided these are without preconditions and aim at a fair outcome.”

Trade tensions

The latest announcement comes amid heightened tensions over trade between the United States and the European Union.

The Council of EU leaders this week (April 15) gave the green light for the Commission to commence negotiations with the United States over a trade agreement but excluded any discussion on agriculture from the mandate.

This decision was met with sharp criticism from US lawmakers and farming groups, who yesterday (April 16) raised doubts that any trade agreement excluding agriculture and food issues would make it through Congress.

The EU Council also said in its statement that no agreement would be concluded if new import tariffs would be applied to EU products. Additional duties on products such as dairy and olive oil, as proposed under the US duties, could cause significant harm to EU exporters.

 

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