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EU seeks plane subsidy deal, but U.S. not talking - bloc's trade chief

EU seeks plane subsidy deal, but U.S. not talking - bloc's trade chief
FILE PHOTO: European Trade Commissioner Cecilia Malmstrom attends an interview with Reuters in Geneva, Switzerland June 14, 2019. REUTERS/Denis Balibouse -
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By Philip Blenkinsop

BRUSSELS (Reuters) – The European Union is urging the United States to hold off trade sanctions and seek an agreement on aircraft industry subsidies, but Washington has shown no sign it wants to talk, EU trade chief Cecilia Malmstrom said on Monday.

The World Trade Organization has approved a U.S. request to impose tariffs on European goods, according to people familiar with the case, part of a 15-year dispute over subsidies for U.S. planemaker Boeing <BA.N> and European rival Airbus <AIR.PA>.

The Geneva-based body is set to announce the scope of the sanctions in the week starting Sept. 30. It is also expected to clear the European Union to take action against U.S. imports early next year.

“Our view is that we have enough tariffs in the world as it is… The U.S. president likes to make deals so we have offered to try to make a deal to find a negotiated solution,” EU Trade Commissioner Malmstrom told a briefing.

The EU presented a proposal in July to discuss issues raised by the cases, including aid for programme development, repayable launch investment and tax subsidies.

“So far, unfortunately, the U.S. has not said that they are willing to negotiate, at least not until they have imposed their tariffs, which they are likely to do quite soon,” Malmstrom said.

The EU trade chief said any EU-U.S. agreement could serve as a template for others to follow to create a level playing field.

“We also know other big players in the world, such as Russia and China but also others, are also subsidising their civil aircraft industry,” she said.

The European Union has drawn up a list of U.S. imports, including aircraft, chemicals and food, worth $20 billion in readiness for a WTO decision likely to be early next year in the Boeing subsidy case.

Malmstrom expressed hope that the bloc would not have to use it.

(Reporting by Philip Blenkinsop)

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