After 17 years of litigation, the European Union and the United States find a "historic" agreement on the war in the skies between Airbus and Boeing. A definitive agreement will still take time, but in the meantime it will be there a 5-year truce during which all duties imposed by both sides will be suspended. In the meantime, negotiations aimed at settling once and for all the dispute over the illegitimate state aid granted by the EU to Airbus and by the USA to Boeing will continue.
The announcement comes following a bilateral meeting between the US president, Joe Biden, the president of the European Council, Charles Michel, and the president of the EU Commission, Ursula von der Leyen.
The truce is undoubtedly good news, a sign of the new climate of collaboration created between the parties after Donald Trump's farewell to the White House and the beginning of new course by Biden. The strong economic repercussions must also be considered: in October 2019, the USA had in fact been authorized by the World Trade Organization (WTO) to impose duties for 7,5 billion dollars (6,8 billion euros) on EU goods and services. A year later, the WTO itself had allowed the EU to impose tariffs for 4 billion euros on US products. The agreement reached today concerns in particular the additional US customs duties of 25% on exports of still wine and spirits and food products, as well as the additional customs duties of 15% on exports of aviation goods. Tariffs related to the steel and aluminum dispute should also be suspended.
However, we must also look at the other side of the coin: the negotiations to find a definitive agreement had already been underway four months and during all this time, however, the solution has not been found, a sign that the question is far from simple to resolve. Therefore, at least for the moment, we will have to settle for a temporary truce.
The other announcement expected at the end of the EU-US summit concerns the creation of a "trade and technology council” to coordinate standards in sensitive sectors starting from artificial intelligence and cooperate to ensure the supply of inputs to production on a global scale to preserve the functioning of value chains and ward off the risks of extreme dependency and bottlenecks.
In a note the EU Commission indicates that now "both parties will try to overcome long-standing differences in order to avoid future disputes and preserve a level playing field between aircraft manufacturers and will also work to prevent the emergence of new disputes".
La US Trade RepresentativeKatherine Tai confirmed that the United States and the European Union reached an agreement today on the Boeing-Airbus case, stressing however that the tariffs will be restored if US companies "cannot compete fairly" with those in Europe. "Today's announcement resolves a long-standing source of tension in US-European relations," the trade representative said. “Instead of fighting against one of our major allies, we finally unite against a common threat,” she added, referring to China. According to the French finance minister, Bruno Le Maire (France is one of the countries most affected by US tariffs, ed.), the five-year truce “will make it possible to define in an operational manner the agreed principles for the public financing of the construction of civil aircraft, and therefore to definitively remove the sanctions. We will now be able to dedicate ourselves to finally putting these differences behind us, and defining conditions of fair competition on a global scale for public support to the aeronautical sector, strategic for both Europe and the United States.' For Le Maire this is "an excellent signal for French and European companies and for transatlantic economic cooperation given that the sanctions, especially in the context of the unprecedented crisis we are experiencing, have been particularly penalizing for our economies".
