The United States and the European Union have agreed on a truce in their near 17-year conflict over aircraft subsidies, suspending for five years one set of Trump-era tariffs which had soured relations between them, according to Reuters.
The two sides have been battling since 2004 in parallel cases at the (WTO) over subsidies for U.S. planemaker Boeing and European rival Airbus, which each argued exposed the other to unfair competition.
They agreed in March to a four-month suspension of tariffs on $11.5 billion of goods from EU cheese and wine to U.S. tobacco and spirits, which the WTO had sanctioned. Businesses have so far paid over $3.3 billion in duties.
On Tuesday it was said that they would remove the tariffs for five years, while still working on the overarching agreement on subsidies they had envisaged in March.
“With this agreement, we are grounding the Airbus-Boeing dispute,” said EU trade chief, Valdis Dombrovskis in a statement during an EU-U.S. summit with U.S. President Joe Biden.
U.S. Trade Representative, Katherine Tai said that the two sides had agreed to clear statements on what support could be given to large civil aircraft producers. They would also work to counter investments in aircraft by “non-market actors,” referring specifically to China.
“We have committed to meaningful cooperation,” added Tai.
The United States and the European Union have agreed to set up a working group on the issue, provide financing on market terms, be transparent on R&D funding, avoid support that would harm the other side and cooperate to address “non-market practices” elsewhere.
Brussels and Washington have said they would seek to address excess global steel capacity largely centred in China.
The United States may find it tougher to remove the metals tariffs, which also apply to other countries such as China because they are still backed by many U.S. metal producers and workers.
Brussels is also pushing what is dubs a new “positive agenda” on trade with Washington, including forging an alliance to drive WTO reform.