The United States and the European Union reached a deal Tuesday to end a 17-year dispute over subsidies to rival plane makers Boeing and Airbus and phase out billions of dollars in punitive tariffs, the U.S. trade envoy said.
U.S. Trade Representative Katherine Tai said the two sides have come to terms on a five-year agreement to suspend the tariffs at the center of the dispute. She said they could be reimplemented if the U.S. companies are not able to “compete fairly” with those in Europe.
“Today’s announcement resolves a long-standing irritant in the U.S.-EU relationship,” Tai said, as President Joe Biden met with EU leaders in Brussels. “Instead of fighting with one of our closest allies, we are finally coming together against a common threat.”
The trade dispute, which first emerged in 2004, skyrocketed under the Trump administration and saw tit-for-tat duties slapped on a range of companies that have nothing to do with aircraft production, from French winemakers to German cookie bakers in Europe and U.S. spirits producers in the United States, among many others.
The U.S. imposed $7.5 billion in tariffs on European exports in 2019 after the World Trade Organization ruled that the EU had not complied with its rulings on subsidies for Airbus, which is based in France. The EU retaliated last November with $4 billion in punitive duties after the WTO ruled that the U.S. had provided illegal subsidies to Boeing.
The EU had been pressing the White House to reach a deal to end the trade tariffs imposed during the Donald Trump presidency, CNBC reported.
THIS IS A BREAKING NEWS STORY. CHECK BACK FOR UPDATES.