EU regulator calls for end of subsidy for Airbus |
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Sun, 25 Sep 2005 13:05
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PARIS: European countries should be ready to stop subsidies for Airbus if they hope to find a solution to the row with the U.S. on this issue, says European Union Trade Commissioner Peter Mandelson. The U.S. contends that Airbus has received billions of euros in unfair subsidies, while the European Union has made a similar accusation concerning U.S. aid for Boeing.
The World Trade Organisation is examining the allegations and Mandelson has said in a newspaper interview that the WTO verdict could disappoint both the parties. He said it may still be possible to restart the negotiations process, but the European governments' funding of the Airbus should adapt to the outcome of the negotiations. Mandelson has appointed a senior Mexican trade official, Mateo Diego-Fernandez, as the official go-between to examine the books of the two companies in search of subsidies.
The U.S. has charged that Airbus has made use of the unfair subsidies worth billions of euros to seize more than half of the world's civil aircraft market at the expense of Boeing. The EU, in a counter, said Boeing had derived benefits from huge subsidies of its own. In July, the WTO entertained the complaint and said it will set up panels to investigate. However, the EU sought more time for consultations and the investigations could not go on.
The dispute constitutes the most significant case in the 10-year history of the WTO and possibly its most costly.
Mandelson, while chiding the EU, went a step further to accuse the U.S. of going in the wrong direction in the issue on farm support. The EU official has two days of meeting with Rob Portman of the U.S. He said the U.S. and the EU are working on different timetables in overhauling their agricultural spending.
An agreement between the U.S. and EU on farming subsidies is a must for the next push for a global trade deal to cap talks that began in late 2001 in Doha, Qatar. The U.S. wants the EU to reduce customs duties, while the EU says the U.S, must reduce support to farmers. But the two countries join forces when they try to persuade countries in the developing world - notably India and Brazil - to adopt measures liberalizing markets for services in sectors like banking, insurance and telecommunications.
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