Europe slams latest US tariff threat as ‘greatly exaggerated’

Both sides have now been found guilty of paying billions of dollars of subsidies to gain advantage in the global aircraft manufacturing business.

The EU is still waiting to hear from the WTO about what “retaliation rights” it has after the organization found in 2012 that Boeing too had received billions of dollars in illegal subsidies that had been to the detriment of Airbus. The WTO also ruled in March that the U.S. had failed to comply fully with its earlier ruling to remove all illegal subsidies that Boeing had received.

The European Commission spokesman also said Tuesday that Brussels is ready to retaliate in kind, noting that in the parallel Boeing dispute, “the determination of EU retaliation rights is also coming closer and the EU will request the WTO-appointed arbitrator to determine the EU’s retaliation rights.”

Some analysts have accused the U.S. of double standards. GAM’s Investment Director for Global Equities, Ali Miremadi, said the U.S.’ tariff proposal was “quite bold.”

“I have to say the country which is the home to Boeing accusing Europe of state subsidies for Airbus — this is quite bold,” he told CNBC’s “Squawk Box Europe” Tuesday.

“It’s very well established that both Boeing and Airbus exist only at the discretion of their respective hosts or host governments.”

President Donald Trump tweeted Tuesday that “the EU has taken advantage of the U.S. on trade for many years.”

UBS’ Global Wealth Management’s Chief Economist Paul Donovan noted wryly that Trump had accepted the WTO ruling much more readily than usual.

“The WTO has ruled that Airbus received unfair subsidies from the EU and U.S. President Trump has, rather unusually, decided to agree with the WTO,” Donovan said in a regular podcast Tuesday.

“Whether U.S. President Trump would be quite so willing to accept the verdict of the WTO about unfair assistance from the U.S. to Boeing, which is an ongoing case, is a rather different matter.”

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