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US, EU Agree to End Airbus-Boeing Dispute

In this June 17, 2019, file photo, an Airbus A 350 - 1000 performs a demonstration flight at Paris Air Show in Le Bourget, east of Paris, France.(AP Photo/Michel Euler, FILE)
US, EU Agree to End Airbus-Boeing Dispute
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The United States and the European Union have agreed to end their nearly 17-year trade dispute over government aid to Boeing and Airbus.

The deal permits the two sides to center on a common economic threat: China.

Since 2004, the U.S. and the EU have argued that government aid to the plane makers brought unfair competition. The dispute became more heated under former U.S. President Donald Trump. It led to more taxes on imports, or tariffs, from American and European products, including French wine, German cookies and American alcohol products.

In March, weeks after President Joe Biden took office, the two sides agreed to suspend tariffs on over $11 billion of goods for four months. On Tuesday, they agreed to suspend the tariffs for five years while still working on an overall agreement.

Ursula von der Leyen is the president of the European Commission. She said the deal moved the parties “from litigation to cooperation on aircraft — after 17 years of dispute.” And Biden said that it is “in the interest of the U.S.A. to have a great relationship with NATO and the EU.”

U.S. Trade Representative Katherine Tai added, “Instead of fighting with one of our closest allies, we are finally coming together against a common threat.” Tai, however, warned that the tariffs could start up again if American companies cannot “compete fairly” with those in Europe.

U.S. President Joe Biden, center, speaks during the EU-US summit at the European Council building in Brussels, Tuesday, June 15, 2021. (AP Photo/Francisco Seco)
U.S. President Joe Biden, center, speaks during the EU-US summit at the European Council building in Brussels, Tuesday, June 15, 2021. (AP Photo/Francisco Seco)

As part of the agreement, the U.S. and the EU will set up a working group to discuss issues including financing and research support for plane makers. They want to avoid support that would harm the other side. And they will fight "non-market practices" from China to help its aircraft industry.

Both sides said they were confident the Airbus-Boeing dispute would end within five years. And plane makers Airbus and Boeing cheered the agreement.

The agreement removes one of two major trade conflicts left over from the Trump administration. The other involves tariffs on EU steel and aluminum imports. That move angered EU leaders because Trump claimed the tariffs were for national security reasons.

The conflict hurts European producers and raises the cost of steel for American companies. And the EU retaliated by raising tariffs on products like U.S.-made Harley Davidson motorcycles and Levi’s blue jeans.

Tuesday’s agreement is welcome news for an airline industry that has been hurt by coronavirus travel restrictions.

It also brings international goodwill for Biden as he prepares to meet on Wednesday with Russian President Vladimir Putin.

I’m Dan Friedell.

Dan Novak adapted this story from reports by The Associated Press and Reuters. Hai Do was the editor.


Words in This Story

tariffn. a tax on goods coming into or leaving a country

litigate v. to make (something) the subject of a lawsuit : to cause (a case, an issue, etc.) to be decided and settled in a court of law

practicen. something that is done often or regularly

irritantn. something that is unpleasant or annoying

retaliate – v. to do something bad to someone who has hurt you or treated you badly : to get revenge against someone