The US is floating the idea of slapping tariffs on $11bn (£8.4bn) worth of products from the European Union.
The move, which would escalate trade tensions between the US and EU, is a retaliation to European aircraft subsidies after the World Trade Organisation (WTO) said that the subsidies have an adverse impact on the US.
Late on Monday, the US Trade Representative (USTR) delivered a proposed list of goods that could be hit by the tariffs. The list include everything from cheese to salmon fillets, and wine to helicopters. The USTR said that the value of the products that are proposed to be hit by tariffs is subject to an arbitration at the WTO. It will take several months to come to a conclusion.
“This case has been in litigation for 14 years, and the time has come for action. The Administration is preparing to respond immediately when the WTO issues its finding on the value of US countermeasures,” said US trade representative Robert Lighthizer in a statement.
“Our ultimate goal is to reach an agreement with the EU to end all WTO-inconsistent subsidies to large civil aircraft. When the EU ends these harmful subsidies, the additional US duties imposed in response can be lifted.”
President Donald Trump’s administration has been embroiled many trade wars across the globe.
The proposed US tariffs would be imposed in addition to existing levies on European products. The world’s most influential executives told Yahoo Finance UK that this is the single biggest threat to the global economy in 2019.
It began in 2018 when the US started slapping tariffs on the imports of steel and aluminium from a number of countries, including the EU. The 28-nation bloc responded by imposing levies on €2.8bn worth of US goods in June later that year. In March this year, Trump threatened more tariffs on the bloc’s goods, including that on cars imported from the EU.
Meanwhile, the US is still negotiating a trade deal with China amid tit-for-tat tariffs.