The European Union and the United States have agreed on Tuesday 15 June 2021 for a lasting escalation of the conflict that opposes them in the aid given to both Boeing and Airbus. After a four-month truce in the trade sanctions they were applying to each other in the framework of this arm-wrestling match, they opted for a five-year extension of this suspension. “We are ending the longest trade dispute in the history of the WTO,” said Ursula von der Leyen.
The two sides agreed in principle to a deal based on “balanced” public funding for both sides, and they agreed to set up a working group to finalise the terms of an agreement.
This is a strong gesture from Europe and Washington that AREV has been calling for since October 2019, when the punitive and unfair taxation began as a result of a problem unrelated to the wine sector.
The losses of the wine sector have not however been compensated and are accumulating with the effects of COVID, Brexit, and episodes related to climate change such as the spring frosts.
Indeed, the battle over subsidies to the aeronautics sector had led to unbalanced cross-sanctions. After the WTO authorised Washington to apply customs duties on European imports amounting to 7.5 billion dollars, it did the same with the EU, concerning American imports, for an amount of only 4 billion. In fact, wine producers suffered export taxes of 25%, which represented an estimated loss of revenue for the sector of around 1.600 billion euros per year. Other European agricultural products, such as certain Italian cheeses and Spanish olive oil, were also taxed.
On the American side, this tightening of transatlantic ties is also the result of the desire to form a block against China. This is how Joe Biden sees the agreement between Airbus and Boeing: “We agreed to work together to challenge and counter China’s non-trade practices in this sector, which give Chinese companies an unfair advantage,” he said.
It is undoubtedly a major step in changing the direction of transatlantic trade relations.