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The European Union and United States agreed to suspend tariffs on billions of euro in trade imposed in a long-running dispute over aircraft manufacturers Airbus and Boeing, the EU announced. The move was hailed as a “fresh start” to relations.
The four-month suspension of tariffs will allow the two sides to work on a resolution to the 16-year row over subsidies, which had seen the US slap tariffs on $7.5 billion in EU exports to the US and the EU to impose them on $4 billion’s worth of US exports to the EU.
Irish products hit by the 25 per cent tariff on imports into the US included Kerrygold, Baileys, and whiskey from Northern Ireland.
In a conversation on Friday, US President Joe Biden agreed to jointly suspend the tariffs as “as a symbol of this fresh start” in the transatlantic relationship, European Commission president Ursula von der Leyen said in a statement.
“This is excellent news for businesses and industries on both sides of the Atlantic, and a very positive signal for our economic cooperation in the years to come,” Dr von der Leyen said.
The conversation also touched on other areas of cooperation including on climate change, Covid-19 vaccine, and Nato. “We share a strategic outlook on Russia, ” Dr von der Leyen said.
The US first filed a case with the World Trade Organisation in 2006 claiming that Airbus had received illegal subsidies, and the EU hit back with a counter case claiming the same of Boeing. The WTO has over the years found that both sides unfairly aided the aircraft manufacturers.
Trade tensions were inflamed under the administration of President Donald Trump which saw a series of tit-for-tat tariffs between the economic powers, and the decision is seen as reflecting a broader reset in the relationship.
France welcomed the news as an end to the dispute. “We are at last ending the trade war between the United States and Europe that only makes losers,” French finance minister Bruno Le Maire said in a statement.
“I am pleased for our French winegrowers. We must keep going on the road of cooperation in order to reach a final deal.”
The agreement mirrors a four-month tariff suspension announced on Thursday by the US and Britain.
EU trade chief Valdis Dombrovskis hailed the new agreement as “a significant step forward”.
“It marks a reset in our relationship with our biggest and economically most important partner. Removing these tariffs is a win-win for both sides, at a time when the pandemic is hurting our workers and our economies,” Mr Dombrovskis said.
The suspension will take effect as soon as both sides have done the required internal procedures, the Commission said.