The United States Trade Representative (USTR) announced on 23 June that it is proposing to “carousel” its retaliation list in the US-EU large aircraft dispute. This US action will potentially remove products currently on the list and modify the scope to include new products, an expanded number of countries, and a possible increase in retaliatory tariffs applied.
These proposed modifications are the latest move in a series of actions in the US-EU large aircraft dispute. On 13 July 2018, the WTO ruled in favor of the United States and approved retaliatory measures against the EU due to subsidies provided for the Airbus company and in EU domestic commercial aircraft industry, which were deemed inconsistent with international trade obligations. Following an initial investigation which began on 12 April 2019, a finalized list of products from EU countries subject to additional tariffs came into effect on 18 October 2019 . On 14 February 2020, the USTR announced a further revised list, including an additional tariff on aircrafts and parts from 10% to 15%, as well as other modifications.
Managing Cross-border Risks and Working to Facilitate Resilient Supply Chains
COVID-19 has undoubtedly changed the landscape of international trade. The turbulent times that COVID-19 has ushered in has subsequently established a chaotic trade climate that has seen both positive and negative trade actions by countries. Supply chains have been affected by manufacturing and port closures, as well as export restrictions on some medical and food products. At the same time, there has been positive trade momentum including tariff deferral and exclusions, economic stimulus, extra commercial plane cargo shipments, and increased demand of certain food products. The highs and lows of the pandemic have required countries to reassess their trade policies. Below is a summary of actions over the past three months and considerations for the future as we transition to a new normal and anticipate another wave of cases in fall and winter.
What has been taking place with the protests?
In February 2019, TradeMoves highlighted Chile's strengths as an export market. We cited a high GDP per capita, preference for US products, and free trade policies as examples of why you should look to export to Chile. Since 2015, 100% of US exports to Chile are duty free as a result of the US-Chile FTA. Chile has largely been considered the economic poster child for Latin America. In the 1980s, Chile opened its borders and deregulated during General Augusto Pinochet's reign. More recently, Chile has further embraced the idea of economic liberalization which has led to an increase in both foreign direct investment within the country and international trade. Since Fall of 2019, Chileans have become increasingly dissatisfied with rising costs and low wages, among other issues. Month-long protests coupled with a week of imposed martial law culminated in a million-person protest in the capital of Santiago in October 2019. The country once thought to be most stable in Latin America is now entering a transition phase of reform.