November 1, 2020

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EU and USA cut export tariffs

EU and USA cut export tariffs

The United States and the EU have reached an agreement to lower their mutual export tariffs. The countries announced this in a joint declaration. According to the negotiators involved, it is a package worth hundreds of millions of euros. It is the first time in twenty years that the EU and the US have cut their mutual export tariffs.

The US is reducing tariffs for ready meals, crystal glassware and cigarette lighter by 50 percent. These products have an annual retail value of around 136 million euros. The EU has decided to remove taxes on live and frozen lobster products for the next five years. The lobsters have a retail value of around 95 million euros.

In recent years, the export duties have risen due to a conflict, among other things, over the European subsidies for the aircraft manufacturer Airbus. Last year, the World Trade Organization (WTO) concluded that the subsidies were illegal state aid. The US was allowed to impose import duties on European products worth 7.5 billion euros.

First step

With this agreement, the American and European negotiators hope to take a first step towards a better relationship. According to ING economist Raoul Leering, however, there is little chance that many other export tariffs will be lowered after this agreement. “It wouldn’t make sense for Trump to fall apart from his beliefs just before the election and adopt a completely different attitude. He has made a name for himself as a president who protects US jobs by increasing import tariffs to give domestic producers a cost advantage . ” “”

According to Leering, the tax rate cut should mainly be seen as an attempt by the EU to give the United States a more favorable vote in other negotiations.