(Bloomberg) -- Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here.
The U.S. added more products from the European Union to a list of goods it could hit with retaliatory tariffs in a long-running trans-Atlantic subsidy dispute between Boeing (NYSE:BA) Co. and Airbus SE. Stock futures fell after the announcement.
The U.S. Trade Representative’s office on Monday published a list of $4 billion worth of EU goods the U.S. could hit with duties as retaliation for European aircraft subsides. The products range from cherries to meat, cheese, olives and pasta, along with some types of whiskey and cast-iron tubes and pipes. It adds to a list of EU products valued at $21 billion that the USTR published in April, according to the release.
The latest targets were identified following a two-day hearing in Washington in May when 40 stakeholders made their cases about the countermeasures. The USTR said a public hearing on the proposed additional $4 billion worth of products will be held Aug. 5.
The USTR estimates the EU subsidies to Airbus cause approximately $11 billion in economic harm to the U.S. annually. The World Trade Organization has found the EU subsidies violate international trade rules and it’s expected to decide this summer on the amount of countermeasures the U.S. can impose.
“The final list will take into account the report of the WTO Arbitrator on the appropriate level of countermeasures to be authorized by the WTO,” USTR said Monday.
‘Negatively Impacted’
While senior EU officials expect the U.S. to move forward with retaliation once the WTO authorizes it, the imposition of the proposed tariffs would threaten to further strain ties as the U.S. and EU try to sit down to negotiate a trade deal.
U.S. industry groups were quick to oppose the tariffs. “U.S. companies -- from farmers, to suppliers to retailers -- are already being negatively impacted by the imposition of retaliatory tariffs by key trading partners on certain U.S. distilled spirits resulting from other trade disputes,” the Distilled Spirits Council of the United States said in a statement after USTR’s announcement.
The EU has its own pending WTO case against Boeing. The EU in April published its preliminary list of U.S. goods being targeted in a $12 billion plan for retaliatory tariffs over subsidies to Boeing, with a focus on farm products from areas that help form President Donald Trump’s political base. Other items in the wide-ranging target list included ketchup, nuts, video game consoles and bicycle pedals.
(Updates to add comment from industry group in seventh paragraph.)
