Valdis Dombrovskis, the new EU trade chief has warned the U.S that it needs to withdraw its US$7 billion tariffs it has recently placed on EU products or it will have to deal with a retaliatory US$4 billion in tariffs on exports to Europe.
For 16 years there has been a dispute between Europe's Airbus and U.S planemaker Boeing over what have been seen as unfair subsidies. Last October the U.S was awarded the right to impose tariffs by the World Trade Organization (WTO), which includes a 25% duty on products such as olives, cheese and single-malt whisky, together with a 10% tariff on European-made Airbus jets.
In February this year the U.S. warned that it would be increasing the Airbus tariff to 15% in an attempt to get Brussels to end the dispute over subsidies. Last month the EU was cleared by the WTO to impose its own tariffs on the U.S. to a total value of US$4 billion. The involvement of Dombrovskis was reported by the FT.
