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18.10.2019 Europe

US tariffs on French wine, Airbus and Scottish whisky come into force

Reuters/Regis Duvignau
LISTEN OCT 18, 2019
Reuters/Regis Duvignau

The United States imposed tariffs on a record 7.5-billion dollars worth of European Union goods on Friday, despite threats of retaliation, with Airbus, French wine and Scottish whiskies among the high-profile targets.

The tariffs, which took effect just after midnight in Washington, came after talks between European officials and US trade representatives failed to make a breakthrough.

The United States was given the formal go-ahead for the tariffs by the World Trade Organization on 1 October.

As recently as Wednesday, US President Donald Trump singled out the Europeans for being unfair with the US on trade, but said his door was open to negotiate a settlement.

Car, aircraft sectors under threat
In the line of fire are civilian aircraft from Britain, France, Germany and Spain; the countries that formed Airbus which will now cost 10 percent more when imported to the US.

A row over government subsidies for Airbus and its American equivalent Boeing began in 2004, and has yet to be resolved.

Friday's tariffs also target consumer products such as French wine, which Trump had vowed to attack in recent months.

Wine from France, Spain and Germany will now face 25 percent tariffs.

The Europeans fear above all that Trump will impose heavy duties on imports of European cars around mid-November.

This would be a serious blow for the German automotive sector in particular, even if giants such as Volkswagen or BMW also manufacture in the United States.

"Our products are very hard to bring in (to Europe)" when Europeans easily import their cars into the United States, Trump said.

Serious repercussions
Speaking in Washington hours before the tariffs were due to come into effect, France's Economy Minister Bruno Le Maire warned the move would have serious repercussions.

"Europe is ready to retaliate, in the framework of course of the WTO," he told reporters shortly after meeting with US Treasury Secretary Steven Mnuchin on the sidelines of the International Monetary Fund annual meetings.

"These decisions would have very negative consequences both from an economic and a political point of view."

Le Maire was due to meet US Trade Representative Robert Lighthizer later on Friday.

The latest measures also come as Washington is mired in a trade war with China and could risk destabilising the global economy further.

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