Trade War on Air and US Troop Pullout from Europe..
(EU Protecting Airbus, Alitalia, Air France using "duties")
Bush threatens possible WTO case against Airbus
AFP ^ / 08/14/04
SEATTLE (AFP) - US President George W. Bush warned that the United States may bring WTO action in September against Airbus Industrie, citing "unfair" government subsidies to the European aircraft maker. "I've instructed US Trade Representative Bob Zoellick to inform European officials in his September meeting that we think these subsidies are unfair and that he should pursue all options to end these subsidies -- including bringing a WTO case, if need be," Bush said. The president's election-year threat to go to the World Trade Organization came after he met behind closed doors here with workers at Boeing, Airbus' archrival, during a campaign swing. "Airbus was founded about 30 years ago and has received, in those 30 years, large government subsidies from European nations, and continues to receive them," said Bush.
"I think it's unfair to this American company that these European governments continue to subsidize Airbus," said Bush. "I believe if our country is treated fairly, we can compete with anybody, anytime, anywhere."
Under a 1992 US-European Union agreement, European support for new aircraft programs -- provided in royalty-based loans -- was limited to 33 percent of the total cost, repayable with interest within 17 years. On the other hand, indirect US support through NASA or military programs was limited to three percent of turnover for the US large commercial aircraft industry.
Boeing has charged that the arrangement allows Airbus to get state money virtually on demand. "We believe in free trade. We want that free trade to be fair, as well. And getting rid of the subsidies of Airbus will make the trade fair, will make the playing field level" said Bush. Zoellick has recently stepped up pressure for an overhaul of the 1992 deal, telling reporters at a news conference July 8 that the agreement was outdated.
Airbus is jointly owned by the European Aeronautic Defense and Space Co., which holds 80 percent, and Britain's BAE Systems, which holds the remaining 20 percent.
AI
