Trump threatens new tariffs on $11bn EU products over Airbus spat

US President Donald Trump said he was considering imposing tariffs on $11bn imports from the European Union as a response the bloc’s subsidies to Boeing's rival Airbus.

US President Trump tweeted on Tuesday: "The World Trade Organization finds that the European Union subsidies to Airbus has adversely impacted the United States, which will now put Tariffs on $11 Billion of EU products! The EU has taken advantage of the U.S. on trade for many years. It will soon stop!"

In a statement on Monday evening, the US Trade Representative’s office cited the World Trade Organization’s findings that the subsidies cause “adverse effects to the United States”.

Trade Representative Robert Lighthizer said that Airbus benefited from illegal “launch aid” over many years which has harmed Boeing.

“This case has been in litigation for 14 years, and the time has come for action. The administration is preparing to respond immediately when the WTO issues its finding on the value of US countermeasures,” Lighthizer said.

“Our ultimate goal is to reach an agreement with the EU to end all WTO-inconsistent subsidies to large civil aircraft. When the EU ends these harmful subsidies, the additional US duties imposed in response can be lifted,” he added.

On Monday the administration also said it would be beginning a process to “identify which products of the EU to which additional duties may be applied” until the subsidies are scrapped. Some of the products on the list include passenger helicopters, cheese, wine, fresh fruit, seafood, jams, ski-suits and some motorcycles.

The tariffs would be added to the already existing levies on European steel and aluminium imports.

The move is likely to further escalate trade tensions between both sides at a time when officials are at the final stages of negotiating the terms of a mandate for the European Commission to begin talks on industrial tariffs with the Trump administration.

It also comes at a time when the EU and China also begin a summit in Brussels today with Chinese premier Li Keqiang set to hold talks on trade relations with Donald Tusk, president of the European Council, and Jean-Claude Juncker, the European Commission president.

Airbus fell by 2.3% on Tuesday on the Paris stock exchange.