U.S., EU set 4-month tariff hiatus

BRUSSELS — A phone call Friday clinched the first trade breakthrough to start rebuilding trans-Atlantic relations between the United States and the European Union in the wake of the Trump presidency.

After U.S. President Joe Biden and EU Commission chief Ursula von der Leyen spoke, the sides decided to suspend for the next four months tariffs used in the long-standing Airbus-Boeing dispute.

Von der Leyen said that “as a symbol of this fresh start, President Biden and I agreed to suspend all our tariffs imposed in the context of the Airbus-Boeing disputes, both on aircraft and non-aircraft products, for an initial period of 4 months.”

It hardly covered all outstanding issues that were left to fester during the fouryear presidency of Donald Trump, but the EU gladly took whatever it could get from the first personal exchange between Biden and Von der Leyen.

Von der Leyen called it “a very positive signal for our economic cooperation in the years to come.”

“This is excellent news for businesses and industries on both sides of the Atlantic,” she said.

In a statement, the White House said Biden had “underscored his support for the European Union and his commitment to repair and revitalize the U.S.-EU partnership.”

With the initiative to ease the aircraft fight that long weighed on trade relations, the 27-nation bloc is seeking to rekindle the spirit of cooperation between Washington and Europe that has long defined global diplomacy.

Von der Leyen said she hopes it is the first indication that the United States and Europe will stand shoulder to shoulder to face global

challenges.

Von der Leyen said she invited Biden to a global health summit May 21 in Rome to streamline the fight against the coronavirus, the common enemy that has killed more than 1 million people in the EU and U.S. combined. She added that she hopes it would extend to foreign policy as well, where both could cooperate better to face the rising power of China.

On Friday though, it was trade that mattered and the suspension will give a fourmonth window to address the more fundamental issues.

The World Trade Organization had authorized the United States and Europe to impose tariffs on each other as part of two parallel disputes, which began almost two decades ago, over subsidies the governments have given to Airbus and Boeing.

The EU had imposed tariffs on roughly $4 billion of American products, while the United States levied tariffs on $7.5 billion of European goods.

The tariff suspension will affect everyone from French winemakers to German cookie bakers in Europe and U.S. spirits producers among many others.

“Lifting this tariff burden will support the recovery of restaurants, bars and small craft distilleries across that country that were forced to shut down their businesses during the pandemic,” the U.S. Distilled Spirits Council said.

“Finally, we are emerging from the trade war between the United States and Europe, which created only losers,” Bruno Le Maire, the French finance minister, said on Twitter. He added that a burden would be lifted for French winegrowers, whose sales have been pummeled by steep retaliatory tariffs that the Trump administration imposed.

Still outstanding, however, are the tariffs that Trump imposed on EU steel and aluminum, which angered Europeans and other allies by calling their metals a threat to U.S. national security. The so-called Article 232 p

roceeding both hurts European producers and raises the cost of steel for American companies. Europe retaliated by raising tariffs on U.S.-made motorcycles, bourbon, peanut butter and jeans.

And Friday’s phone call has not dented Europe’s push for digital taxes on American technology companies like Google and Amazon.