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03.10.19 13 FOREIGN NEWS THE US yesterday won approval to im- pose tariffs on $7.5 billion worth of Eu- ropean goods over illegal EU subsidies handed to Airbus. e move threatens to trigger a tit-for- tat transatlantic trade war as the global economy falters. e decision by the World Trade Or- ganization pushes a 15-year corporate dispute over illegal support for transat- lantic plane giants to the centre of caus- tic world trade relations and comes on top of a tariff war between the US and China. e European Commission said in re- sponse that a US move to impose trade sanctions on EU imports would be "short-sighted and counterproductive" and risked causing damage on both sides of the Atlantic. e WTO has found that both Eu- rope's Airbus and its US rival Boeing received billions of dollars of illegal sub- sidies in the world's largest corporate trade dispute, a legal marathon dating back to 2004. e two cases are expected to lead to tit-for-tat tariffs, beginning with the US measures, posing new problems for businesses and financial markets around the world. e focus of nervous markets will now shift to Washington where the US Trade Representative is expected to move quickly to narrow down a prelim- inary list of goods in line for tariffs, a US source said. e agency's provisional list of prod- ucts that are eligible to be targeted with tariffs ranges from Airbus jets them- selves to helicopters, wine, handbags and cheese. Before any tariffs can be imposed, the WTO's Dispute Settlement Body must formally adopt the arbiters' report in a process expected to take between 10 days and four weeks. Its next scheduled meeting is on Oc- tober 28, but Washington could request a special meeting 10 days after the arbi- ters' report is published, suggesting an earliest possible final nod on October 12. In the largest case ever handled by the WTO, Washington had requested per- mission to impose tariffs on up to $11.2 billion of EU goods. Brussels is pushing for tariffs of around $10 billion on American goods in a par- allel process to be decided by the WTO early next year. While the level of tariffs amounts to less than three days worth of annual trade between Europe and the US, im- porters led by US airlines that buy Air- bus jets have urged Washington to be selective when choosing industries to hit in order to avoid causing collateral damage to the US economy. e WTO award in the dispute could fuel rising trade tensions, diplomats say. EU manufacturers are already fac- ing US tariffs on steel and aluminium and a threat from US President Don- ald Trump to penalise EU cars and car parts. e EU has in turn retaliated. e Trump administration has con- cluded tariffs were effective in bring- ing China to the negotiating table over trade, and in convincing Japan to open its agricultural market to US products. Washington is unlikely to skip the op- portunity to implement tariffs in the case over aircraft subsidies, according to current and former U.S. officials. Airbus has said this would lead to a "lose-lose" trade war and has published a video stressing its contribution to the US industry through local assembly plants and 4,000 direct jobs, headlined "Together, let's keep American aero- space great". WTO awards US right to hit $7.5 billion of EU goods over Airbus subsidies In June, American Airlines ordered 50 new Airbus A321XLR planes US Airways operates 40 Airbus A320-231 aircraft

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