Baileys and Kerrygold win reprieve in US as Biden calls truce on tariffs
President Biden takes action on one of world’s longest-running trade disputes between Boeing and Airbus
THE European Union has secured a four-month stay on tariffs affecting Irish booze and dairy exports as part of a rapprochement with the US.
Baileys Irish Cream liqueur and Kerrygold butter were some of the products caught up in the two-year tariff war.
Yesterday, the US agreed to lift tariffs on $7.5bn (€6.3bn) worth of EU products, including 25pc levies on French and German wine, Italian cheeses and Spanish olives.
The EU has also agreed to suspend tariffs on $4bn worth of US airplanes, lorries, tobacco, video game consoles, orange juice, wine and a range of other foods and goods.
Negotiations will take place during the suspension.
The deal was done after a phone call between US president Joe Biden and European Commission president Ursula von der Leyen on yesterday afternoon.
The White House said in a statement that Mr Biden wanted to “repair and revitalise the US-EU partnership” and would work towards resolving the dispute permanently at the World Trade Organization.
Ms von der Leyen said it was “the start of a good personal partnership” with the American president.
“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 four months.
This is excellent news for businesses and industries on both sides of the Atlantic, and a very positive signal for our economic cooperation in the years to come.”
EU trade chief Valdis Dombrovskis said it was a “significant step forward” and marked a “reset” in the EU-US relationship.
“Removing these tariffs is a win-win for both sides, at a time when the pandemic is hurting our workers and our economies. This suspension will help restore confidence and trust, and therefore give us the space to come to a comprehensive and long-lasting negotiated solution. A positive EU-US trade relationship is important not only to the two sides but to global trade at large.”
The tariff war began in 2019, an escalation of a decades-long dispute over state aid to aircraft giants Boeing and Airbus.
Just last December, the US stepped up the fight, imposing new tariffs on French and German aircraft parts and wines, UK books and clothes and a range of dairy, meat and fruit exports from the rest of the EU.
Tariffs on Bushmills single malt whiskey, which is produced in Northern Ireland, were suspended earlier this week as part of a separate deal Mr Biden did with the UK.
Irish alcohol exports fell by 19pc in 2020, according to Bord Bia, on the back of Covid-19 lockdowns, Brexit and US tariffs. However, dairy exports to the US were up 11pc in value, despite the tariffs.
Friday’s agreement does not include tariffs imposed by both sides as part of a 2018 fight over steel and aluminium subsidies.
In that dispute, tit-for-tat tariffs were placed by Brussels on Bourbon, blue jeans and motorbikes, after the Trump administration targeted EU steel and aluminium exports.
The suspension “will provide great relief to both our exporters and importers that have been negatively impacted by the tariffs, particularly our exporters of quality goods like Irish cream liqueur, butter and cheese and our importers of animal feedstuff”, said Tánaiste and Enterprise, Trade and Employment Minister Leo Varadkar.
Minister of State for Trade promotion Robert Troy said Ireland had been “caught in the crosshairs” of the EU-US dispute and knew the “damaging consequences punitive tariffs can have on a trader’s competitiveness”.
US to lift tariffs on $7.5bn of EU goods