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US imposes new tariffs on French, German products in Airbus-Boeing spat

France's President Emmanuel Macron and Germany's Chancellor Angela Merkel look at US President Donald Trump at the NATO leaders summit in Watford, Britain December 4, 2019. (Reuters photo)

The United States plans to impose more tariffs on French and German products amid a 16-year US-EU dispute over subsidies for aircraft manufacturers Airbus and Boeing.

The US Trade Representative (USTR) announced in a statement on Wednesday that the tariffs are on "aircraft manufacturing parts from France and Germany" among other products.

The decision, the latest twist in the trade battle that turned increasingly sour under the administration of President Donald Trump, comes despite hopes for a trade truce following Joe Biden's election win.

The move, which will add the new products to the list of those taxed since 2019, was in retaliation to tariffs imposed by the European Union.

In November, the World Trade Organization (WTO) authorized the EU to levy additional customs duties on American imports amounting to almost €3.4 billion ($4 billion) a year.

That move came in retaliation for unjust US aircraft subsidies, but Washington believes the bloc had unfairly calculated tariffs against the US.

"In implementing its tariffs... the EU used trade data from a period in which trade volumes had been drastically reduced due to the horrific effects on the global economy from the Covid-19 virus," the USTR statement said.

"The result of this choice was that Europe imposed tariffs on substantially more products than would have been covered if it had utilized a normal period. Although the United States explained to the EU the distortive effect of its selected time period, the EU refused to change its approach," the statement said.

Washington, as a result, "is forced to change its reference period to the same period used by the European Union," it added.

The aviation dispute predates Trump, however, the US quickly seized the opportunity to levy $7.5 billion in tariffs against Europeans after also being cleared to do so by the WTO last year.

The punitive tariffs of 25 percent imposed by Washington affected iconic EU products such as wine, cheese and olive oil. In addition, the US levied tariffs of 15 percent on Airbus planes in March.


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