EU to target Boeing and bourbon for potential US tariffs in blow to Ireland
US president Donald Trump is threatening a 30 per cent tariff on imports from the EU from August 1st, a level European officials say is unacceptable and would end normal trade between two of the world's largest markets.
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The list, sent to EU member states and seen by Reuters on Tuesday, pre-dates Trump's move over the weekend to ramp up pressure on the 27-nation bloc and responds instead to US duties on cars and car parts and a 10 per cent baseline tariff.
The package also covers chemicals, medical devices, electrical and precision equipment as well as agriculture and food products – a range of fruits and vegetables, along with wine, beer and spirits – valued at €6.35 billion.
The Irish Government had tried to convince the Commission not to target US bourbon whiskey, Boeing aircraft and agriculture produce in potential retaliatory tariffs.
Ministers were concerned that hitting these US industries would have knock-on economic impacts for the same sectors in Ireland, or could draw even higher tariffs on Irish whiskey and agriculture produce from Mr Trump.
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The proposed EU tariffs on the US aviation sector target aircraft manufacturer Boeing, which would be a significant blow to Dublin-based airline Ryanair, which buys planes from the aviation giant.
Following a meeting of EU ministers in Brussels on Monday, officials said they were still seeking a deal to avoid Trump's heavy tariff blow.
But EU trade chief Maros Sefcovic said those at the meeting expressed unprecedented resolve to protect EU businesses using European countermeasures if negotiations with Washington fail to produce a deal.
"The message was [the] strongest I've witnessed since we started the discussion with the US. And therefore we'll negotiate first, but we'll prepare at the same time," he said at a press conference.
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French foreign minister Jean-Noel Barrot said on Tuesday that Trump's new threat had "the appearance of blackmail", adding the priority was to find a trade agreement but not at the cost of becoming a "a vassal of the United States".
Trump has warned Brussels against retaliation, stating that the US would match any new European levies by simply adding them to the 30 per cent rate.
The European Commission, which oversees EU trade policy, has not yet specified a tariff rate for the products on its list.
EU members will need to approve the package before it is implemented, and there is no specific date set for a vote.
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The Commission would typically hear concerns from EU governments and then proceed with the countermeasures unless 15 countries oppose them.
Ireland
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Europe's drinks industry, which is heavily dependent upon the US market, has been lobbying governments to exclude bourbon or any wine and spirits from the EU's list due to fear of retaliation by Washington. France, Spain and Italy have expressed concern over the potential impact on their economies.
Alcoholic drinks were removed from the EU's first package of tariffs approved in April. That package on €21 billion worth of US goods was immediately suspended to allow room for negotiations. Its suspension has now been extended to August 6th.
European shares traded slightly higher on Tuesday, buoyed by automotive stocks, after Trump said on Monday he was open to talks with the EU and other trading partners.
The Commission initially put forward the second package in May for a public consultation, earmarking some €95 billion worth of US goods for countermeasures. It has since been whittled down, though most of the main items have remained.
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