US proposes tariffs on EU cheeses, Scotch whisky

The United States is again taking aim at the European Union's subsidies on large commercial aircraft, proposing increased tariffs on some products the continent is famous for, such as olives, Parmesan cheese and pasta from Italy, and Irish and Scotch whisky.

On Monday, the Office of the US Trade Representative, or USTR, solicited public comment on a proposed list of products "that could potentially be subject to additional duties in order to enforce US rights in the World Trade Organization dispute against the EU and certain EU member states regarding EU subsidies on large civil aircraft".

The supplemental list, which applies to the 28 member states of the EU, adds 89 tariff subheadings with an approximate trade value of $4 billion to an initial list published on April 12, which had an estimated trade value of $21 billion.

The USTR said it was adding to the list in response to public comment, after more than 40 people testified at public hearings on May 15-16. A hearing on the new list is scheduled for Aug 5.

The US and the EU have threatened to impose billions of dollars in reciprocal tariffs in a 14-year dispute at the WTO over aircraft subsidies given to US aircraft maker Boeing and its European rival Airbus.

Monday's move followed news during the Paris Air Show that the US could be open to negotiations on an "enforceable mechanism" that could allow Airbus to receive government funding on commercial terms, potentially leading to a resolution to the aircraft subsidy fight.

Such a deal also would include moves by the US to address tax incentives provided by the state of Washington and make them compliant with trade rulings, as part of a possible new framework for aircraft industry funding, two US sources told Reuters.

The WTO is expected to rule on the US sanctions request by September.

So that antipasto appetizer platter also could be made more costly. Edam, gouda and gruyere cheeses are on the list, too. European countries produce about three quarters of the world's olive oil, which featured prominently on the April list.

The North American Olive Oil Association is petitioning the USTR to remove olive oil from the list.

It wasn't all delicacies, though. Ten copper-based products showed up on Monday on the USTR "annex" list.

"Our ultimate goal is to reach an agreement with the EU to end all WTO-inconsistent subsidies to large civil aircraft," USTR chief Robert Lighthizer said in April. "When the EU ends these harmful subsidies, the additional US duties imposed in response can be lifted."

The USTR said in April that "after many years of seeking unsuccessfully to convince the EU and four of its member states (France, Germany, Spain, and the United Kingdom) to cease their subsidization of Airbus," it brought the challenge to EU subsidies to the WTO in 2004.

The dispute followed positive news out of the G20 in Osaka, Japan. US President Donald Trump, after meeting on Saturday with Chinese President Xi Jinping, said he would postpone tariffs on $300 billion of Chinese imports and relax some restrictions on telecom giant Huawei. The two nations also agreed to resume trade talks. Stocks markets rallied in response on Monday.

Reuters contributed to this story.

hengweili@chinadailyusa.com

(China Daily 07/03/2019 page12)