U.S. handbags, shovels on $20 billion EU tariff list over Boeing

[April 17, 2019]   By Philip Blenkinsop

BRUSSELS (Reuters) - Handbags, tractors, shovels and fish are part of an 11-page list of U.S. imports worth $20 billion that the European Union on Wednesday said it could hit with tariffs in a transatlantic aircraft subsidy dispute.

 European Union flags fly outside the European Commission headquarters in Brussels, Belgium, April 10, 2019. REUTERS/Yves Herman

The United States and the European Union have been battling for almost 15 years at the World Trade Organization over subsidies given to U.S. planemaker Boeing and its European rival Airbus.

After partial victories for both sides, each is asking a WTO arbitrator to determine the level of countermeasures they can impose on the other.

The Trump administration last week proposed targeting a seven-page list of EU products for tariffs, ranging from large aircraft to dairy products and wine, to counteract the harm from EU subsidies for Airbus worth an estimated $11 billion.

Brussels has responded with its own list of some $20 billion worth of U.S. imports, including agricultural produce from dried fruit to ketchup, planes, fish, tobacco, handbags, suitcases, tractors, helicopters and video game consoles.

The published list will now be open to consultation until May 31 and could then be revised.

"The EU remains open for discussions with the U.S., provided these are without preconditions and aim at a fair outcome," EU Trade Commissioner Cecilia Malmstrom said in a statement.

In both cases, WTO arbitrators have yet to set an amount, but the U.S. case against Airbus is more advanced, with a ruling possible in June or July. The EU case against Boeing could come early in 2020.

Both sides have said they would prefer a settlement that did not lead to the imposition of tariffs.

The European Union has meanwhile declared itself ready to start formal trade talks with the United States.

The Commission is set to start two sets of negotiations - one to cut tariffs on industrial goods, the other to make it easier for companies to show products meet EU or U.S. standards.

However, it has insisted that agriculture not be included, putting the 28-country bloc at odds with Washington, which wants farm products to be part of the talks.

(Reporting by Philip Blenkinsop; Editing by Alissa de Carbonnel)

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