US scraps aviation deal with Europe, files WTO case over Airbus
AFP, Washington
The United States opened an aviation dogfight with Europe on Wednesday, scrapping a 12-year-old accord and filing a complaint with the World Trade Organization over European subsidies to Airbus. The US decision, announced in the run-up to the November 2 presidential election, makes good on President George W. Bush's threat to take the politically charged case to the global trade body. US Trade Representative Robert Zoellick released a statement saying the United States had been trying to convince Europe to halt billions of dollars in "unfair subsidies" to Airbus. "But the EU and Airbus appear to want to buy more time for more subsidies for more planes," he said. "That isn't fair, and it violates international trade rules. Since we could not agree, the United States decided to pursue resolution through the agreed procedures of the multilateral trading system, by bringing a WTO case before an international dispute resolution panel." Bush told Boeing Co. aviation workers during a campaign rally in Seattle, Washington, August 14 that he was ready to take a case to the WTO over the subsidies. Since its creation, Airbus has overtaken Boeing in many aviation sectors, and Bush said the government payments were "unfair." Subsidies had been allowed under a 1992 transatlantic accord, which the United States decided to scrap. "Consistent with today's decision to move forward with a WTO case, the United States also exercised its right, as provided by the 1992 agreement's terms, to terminate that agreement," the US statement said. US giant Boeing Co. has been raising concerns here that Airbus will use European government subsidies to launch a rival plane to its planned twin-aisle fuel-efficient Dreamliner 7E7 jet. In an election year, Boeing's campaign has added bite. "This is about fair competition and a level playing field," Zoellick said. EU to file WTO complaint The European Commission said Wednesday it will file its own complaint at the World Trade Organisation in response to the US action over state aid for European aircraft maker Airbus. Commission spokeswoman Arancha Gonzalez, asked if the commission would respond with its own complaint to the WTO over US state support for Airbus' US rival Boeing, said: "Absolutely, yes."
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