On Wednesday, the World Trade Organization (WTO) established that the United States will be able to impose tariffs on goods from the European Union for 7.5 billion dollars a year (6.8 billion euros). This ruling is part of a legal dispute between the two largest aircraft manufacturing companies in the world, Airbus and Boeing, one European and the other American, which has been going on for 15 years.
Boeing accuses Airbus of having received illegal subsidies from the European Union over the years, and Airbus says the United States has done the same with Boeing. In 2016, the World Trade Organization had established that the European Union was benefiting Airbus with improper subsidies and Trump had threatened to impose duties of around 11 billion dollars a year. A ruling similar to that of Wednesday is expected in the first few months of 2020, but it will concern the aid granted by the United States to Boeing.
The duties will start from next October 18th, and will hit both a series of technological products of the aeronautical sector made in the United Kingdom, France, Germany and Spain (the four countries of the Airbus consortium), and products of the agro-food sector of Italy. The complete list of products affected by the duties was published on the website of the US Department of Commerce .
In the list the duties that will concern Italy are limited to a series of dairy products such as Parmesan and pecorino, and cold cuts such as ham, while the countries of the Airbus consortium will be subject to duties also on exports of a wider range of foodstuffs (including oil and wine, which instead will not cover Italy), clothing products, and other consumer goods. The duties on these products will be 25 percent, while aircraft components will be subject to 10 percent duties.
The duties on Italy could prove to be a big problem especially for the exports of some goods that have one of their main markets in the United States: it is estimated that agri-food exports in the United States are worth 30 percent of all exports outside the Union European, worth about € 4.5 billion.
Among the products that are likely to suffer the greatest damage from duties is Parmigiano Reggiano, for which the United States is the second foreign market after France. Nicola Bertinelli, President of the Parmigiano Reggiano Consortium for Protection, said that a total of 10 million kilograms of Parmesan per year is currently sold in the United States, at an average price of $ 40 per kilo: “If with the introduction of higher tariffs the price will rise to 60 euros per kilo, we estimate losses of 90% of the turnover in the United States. Which means having to find new market spaces for 9 million pounds. All wondering: what do we have to do with the aid deemed illegal on Airbus? A diatribe that is now being paid to a third country, “said Bertinelli.
Prime Minister Giuseppe Conte called the issue of duties a “very serious” problem which he discussed with US Secretary of State Mike Pompeo during his visit to Italy: “Italy is perfectly aware that there is a tension commercial on a global level and certainly the prospect of this comparison of duties between the United States and the European Union and cannot but consider that we are involved as the European Union. But we are confident that we can receive attention from one of our traditional allies, the United States, on what are some of our productions that we consider to be truly strategic in the context of international trade “.