The EU-US Summit took place on Friday 20 October in Washington, in the presence of Presidents Biden and von der Leyen. While a wide range of topics beyond trade issues were on the agenda, the Summit was initially taunted as a crucial moment in discussions on a Global Sustainable Arrangement (GSA) for steel & aluminium, seen as the pathway to a permanent resolution of the EU-US steel and aluminium dispute. Unfortunately, while both sides reiterated their desire to reach an agreement and reported progress in negotiations, the Summit did not deliver a real breakthrough towards a permanent resolution of this dispute. Meanwhile, the separate dispute on large civil aircrafts (commonly known as “Airbus-Boeing”) was not on the agenda.
While spirits are not at the centre of any of these disputes, our sector has been caught in the crossfire – like many other “unrelated” sectors. US Whiskey & Bourbon faced 25% rebalancing tariffs in the EU in the frame of the steel and aluminium dispute, until they were temporarily suspended for a period of 2 years at the end of 2021. Meanwhile, EU and US spirits also faced 25% retaliatory tariffs in the frame of the Airbus and Boeing disputes, until these were suspended for 5 years in mid-2021. These tariffs had a devastating effect on our sector, and with the deep level of integration across the Atlantic, very often, the same companies ended up facing multiple retaliatory tariffs in the frame of different disputes – all the while being completely unrelated to the sources of the disputes. The suspensions really helped and we have been calling ever since for these temporary tariff removals to be made permanent. This is essential for companies to be able to keep investing on both sides of the Atlantic.
With only two months left before a possible return of the rebalancing tariffs in the frame of the steel & aluminium dispute, we were hoping for closure and the announcement that a permanent removal had been agreed or was imminent. Instead, companies face once again the prospect of a return of tariffs and tremendous uncertainties until the end of the year – with a potential doubling of these rebalancing tariffs on 1 January 2024.
In a particularly divided and volatile world, the EU & the US should be putting aside their differences and leave these disputes where they belong – in the past. We urge both sides to make the temporary suspensions permanent as a matter of urgency – particularly given the time pressure for steel & aluminium, and to start working instead on a positive bi-lateral trade agenda.
