US Suspends Tariffs on UK Goods to Resolve Aircraft Dispute

As part of an effort to settle the trans-Atlantic trade conflict regarding aerospace subsidies, the US has finally decided to suspend tariffs worth millions of dollars on UK exports, including Scotch whisky. The suspension will last for four months as both countries strive to reduce trade tensions surrounding aid for Airbus and Boeing. 

Back in 2019, in response to the state support given to Airbus, the Trump administration, under former President Donald Trump, had imposed tariffs on European products worth $7.5 billion. Other Airbus stakeholders such as Germany, Spain, and France were targeted as well.

However, the European Union (EU) did not sit back and instead retaliated with tariffs on up to $4 billion of US goods over subsidies to Boeing. But the UK did also state that it would suspend the tariffs starting from January as an attempt to ease tensions, prompting President Joe Biden to reciprocate this move with a fair offer. 

Recently, in the joint US-UK statement, it was mentioned that “this will allow time to focus on negotiating a balanced settlement to the disputes, and begin seriously addressing the challenges posed by new entrants to the civil aviation market from non-market economies, such as China. This will benefit a wide range of industries on both sides of the Atlantic, and allow for focused settlement negotiations to ensure that our aerospace industries can finally see a resolution and focus on COVID recovery and other shared goals.”

Manufacturers of Scotch Whisky were especially delighted by this tariff reduction from 25% to zero. Before this announcement, Scotch exports to the US had fallen by a third, costing the industry over half a billion pounds. 

Karen Betts, CEO of the Scotch Whisky Association, stated that “suspending these tariffs – stemming from a transatlantic trade dispute that had nothing to do with us – and a return to tariff-free trade with the US means livelihoods and communities across Scotland will be protected.”

Moreover, according to the UK Department for International Trade, producers of cashmere, Stilton cheese, and pork will also be able to enjoy the positive impacts of the tariff suspension. 

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