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WASHINGTON — The United States and the European Union are preparing to impose tit-for-tat tariffs on each other’s products, the latest escalation in a 14-year fight over government aid given to Boeing and European rival Airbus.
“The World Trade Organization finds that the European Union subsidies to Airbus has adversely impacted the United States, which will now put Tariffs on $11 Billion of E.U. products!” President Trump said in a tweet on Tuesday morning. “The E.U. has taken advantage of the U.S. on trade for many years. It will soon stop!”
The United States Trade Representative said on Monday night that it was preparing a list of European products to tax as retaliation for European subsidies to Airbus, which the World Trade Organization ruled were illegal in May 2018. That prompted the European Union to announce that it was also readying a list of tariffs to counter American subsidies to Boeing.
The moves come amid tense trade relations between the United States and Europe, which are engaged in tit-for-tat tariffs following Mr. Trump’s decision last year to tax European steel and aluminum. Mr. Trump has repeatedly threatened to impose tariffs on European cars and car parts if the European Union does not agree to better trade terms for American products and Europe has said it will retaliate on American goods if Mr. Trump follows through on that threat.
The announcement of new tariffs stems from a dispute that began in 2004 related to government subsidies that Europe provides to Airbus, which is a rival to America’s Boeing.
Last May, the W.T.O. found that Airbus had received illegal funding for several of its aircraft models. The United States requested the authority to impose retaliatory tariffs of $11.2 billion per year, and the two sides are awaiting a decision on the level of tariffs that the United States will be authorized to levy on the European Union.
In preparation for that decision, which is expected this summer, the United States announced Monday night that it was beginning to identify European products to tax, so it could impose the duties as soon as the organization ruled. The initial list would cover $11 billion of trade in products including airplanes, cheese, fish, wine, clothing, nails, pipes and clocks — the same dollar amount of harm that the United States Trade Representative estimated European subsidies cause each year.
“This case has been in litigation for 14 years, and the time has come for action,” Robert Lighthizer, the United States Trade Representative, said in a statement.
“Our ultimate goal is to reach an agreement with the E.U. to end all W.T.O.-inconsistent subsidies to large civil aircraft,” Mr. Lighthizer said. “When the E.U. ends these harmful subsidies, the additional U.S. duties imposed in response can be lifted.”
The European Commission indicated on Tuesday that it considers the $11 billion in retaliatory measures to be overblown and not justified by any findings by the World Trade Organization.
“The figure quoted by the U.S. trade representative is based on U.S. internal…
