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U.S. Business U.S.-EU trade dispute heats up as White House proposes tariffs on another $4-billion of goods

The Trump administration has proposed placing tariffs on an additional $4 billion of imports from the European Union, including cherries, whisky and coiled copper, in a further escalation of a 14-year fight over government aid for aviation companies.

The United States had previously identified European imports worth $21 billion a year for potential tariffs in retaliation for Europe’s subsidies for Airbus. On Monday, the administration added dozens of products to the list “in response to public comments and additional analysis,” according to the U.S. trade representative’s office.

The United States is awaiting the World Trade Organization’s approval before imposing tariffs on the initial list of products. The items added Monday would be subject to a public hearing.

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The European Commission declined to comment on what it described as an internal U.S. procedure, but it said in an e-mailed statement that “the figures quoted by the U.S.T.R. are based on U.S. estimates that have not been awarded by the WTO.”

“The EU remains open for discussions with the U.S., provided these are without preconditions and aim at a fair outcome,” the statement said.

Other European products identified Monday for potential tariffs included Edam and Gouda cheese, roasted coffee, olives and cast iron pipes. The earlier list included airplanes, seafood, wine, clothing and clocks.

Trade relations between the United States and Europe became strained last year after President Donald Trump decided to target European steel and aluminum with tariffs. Trump has also threatened to impose import levies on European cars and car parts.

The tariff battle has intensified a fight between the two sides over government aid to Airbus and Boeing that began in 2004.

The World Trade Organization found in May 2018 that Airbus had received illegal financing for several of its aircraft models. The United States has long argued that the so-called launch aid provided to Airbus gave it an unfair advantage over Boeing. In response to the ruling, U.S. officials submitted plans to impose tariffs on European products.

“The proposed additional tariffs only add to the trade tensions and in reality do not change anything,” Justin Dubon, an Airbus spokesman, said in an e-mail Tuesday. He added that it was up to the trade organization to define how each side could retaliate. The move, he said, risked putting companies on both sides of the Atlantic in a “lose-lose situation.”

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European criticism of the American aviation industry has centred on government research contracts and tax breaks that go to Boeing, which has been scrambling to return its 737 Max jet to service after two fatal crashes forced the company to make fixes.

After the WTO found that Boeing had gotten tax breaks in Washington state and incentives in South Carolina that amounted to subsidies, the European Union asked for the authority to impose retaliatory tariffs on the United States. The European Commission is awaiting the trade organization’s decision before specifying which American products to hit with tariffs.

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