Europe

The U.S. and the United Kingdom have agreed to a five-year moratorium on retaliatory tariffs for large civil aircraft subsidies in an accord designed to “finally” put longstanding disputes to rest, U.S. Trade Representative Katherine Tai said on Thursday. 

The U.S. and European Union on Tuesday pledged to address steel and aluminum global overcapacity – ideally including the removal of U.S. Section 232 tariffs – by the end of the year, another accord reached during a wide-ranging summit that also included announcements on vaccine access and climate issues as well as aircraft subsidies.

The U.S. and European Union on Tuesday agreed to a framework that would suspend for five years all tariffs levied due to the near 20-year-old Boeing-Airbus disputes, establish a trans-Atlantic working group on aircraft, improve subsidy transparency and provide a platform to cooperate on a joint approach to the threat from China’s subsidized aircraft sector.

“Today's announcement resolves a longstanding trade irritant in the U.S.-Europe relationship,” U.S. Trade Representative Katherine Tai told reporters. “Instead of fighting with one of our closest allies, we are finally coming together against a common threat.”

Major U.S. and European business groups are optimistic about the trans-Atlantic summit in Brussels on Tuesday, urging the two sides to quickly resolve bilateral trade disputes and to look ahead in tackling global issues like climate change and a joint approach to China.

President Biden and other G7 leaders on Sunday laid out a vision for a modernized World Trade Organization that will require reforms addressing harmful industrial subsidies and special and differential treatment, a reinvigoration of the negotiating arm and solutions to longstanding dispute settlement problems.

Former U.S. and European officials sparred on Thursday over the European Union’s dealings with China and how the trans-Atlantic allies should take on Beijing, debating whether China’s system is “fundamentally” at odds with the international system or whether a more “nuanced” approach should be followed.

Biden and Johnson will also launch negotiations on a bilateral technology agreement.