From ‘Banana Wars’ to Steel Tariffs, Trade Spats That Marred US-EU Trade
The US and EU flags, left and right, fly side by side at the European Council building in Brussels
Emmanuel Macron said earlier that he and President Joe Biden were geared to “fix” the spat over US legislation granting tax reductions and energy benefits to businesses investing in the US. But the French president also drew attention to the “de-synchronization” in relations between Europe and the United States.Washington’s new legislation, the $430 billion Inflation Reduction Act, signed recently by President Joe Biden, has set the European Union (EU) and the United States headed towards the brink of what has been dubbed a major transatlantic trade dispute.What has got Paris and other European capitals up in arms is the “aggressively” protectionist US policies that come part and parcel of the act. The legislation signed by Joe Biden in August includes expanding tax subsidies for the purchase of electric vehicles that are assembled in North America and use US-made batteries from local materials. The Inflation Reduction Act also allocates $370 billion towards furthering clean energy and climate goals and $64 billion to lowering the cost of medicines and health insurance. The EU considers the law discriminatory against similar products imported from other countries. US policies subsidizing American companies were slammed by French President Emmanuel Macron as “choices that will split the West.” Macron paid an official visit to the US from November 29 to December 2. He met with US President Joe Biden in Washington. Since then, he has been upbeat about “fixing” the falling out between the two sides on the issue several times.The current standoff between the EU and the United States calls to mind previous instances of acrimony over trade practices between the two allies.
World‘It’s Urgent & We Can Do It’: Macron Says He and Biden Will ‘Fix’ Spat Over US Subsidies Legislation09:04 GMT
Trump’s Steel & Aluminum Tariffs
45th POTUS Donald Trump initiated a trade war with the EU in March 2018, saying at the time, “Trade wars are good and easy to win.” Trump’s announcement to set a 25 percent duty on imported steel and 10 percent on aluminum left America’s closest European allies reeling from the shock announcement. The then-president was convinced that the tariffs would safeguard American jobs, insisting:“We’re going to build our steel industry back and our aluminum industry back.” The dispute got more heated after threats were made to tax German cars if the EU refused to lower barriers to imports from the US. The EU had warned it would retaliate against its companies if their interests were threatened by this move. Trump dug in, however, tweeting at the time that “If the EU wants to further increase their already massive tariffs and barriers on US companies doing business there, we will simply apply a Tax on their Cars which freely pour into the US.”The European Union drew up a retaliatory list of US products on which the EU aimed to apply a 25 percent tit-for-tat levy. The list at the time was reported to include a range of consumer goods worth around one billion euros, agricultural products totaling 951 million euros, and steel and other industrial products imported from the US valued at 854 million euros. Among them: motorcycles, jeans, bourbon whiskey, shirts, cosmetics, pleasure boats, orange juice, corn, and steel.The EU also filed complaints with the World Trade Organization. Under President Joe Biden, the US and EU resolved the dispute over Trump-era tariffs in 2021. The deal allowed duty-free access for limited amounts of EU-produced metals while fending off retaliatory EU tariffs.
World’We Are not Afraid’: EU Stands-Up to Trade ‘Bullies’ in Tariff Row With US12 March 2018, 14:49 GMT
Steel Tariff of 2002
The United States and Europe were also locked in a steel tariff war in 2002, when then-US President George W. Bush set in place temporary tariffs of between 8 and 30 percent on steel imports – ostensibly to boost the country’s steel industry. At the time, Canada and Mexico were exempt, in line with the North American Free Trade Agreement (NAFTA). However, retaliation was swift, as the EU rustled up some tariffs on Florida oranges and US cars. A complaint was also filed against the United States with the World Trade Organization. Eventually, Washington was found to be in violation of tariff rate commitments, with the administration forced to scrap the duties.
Banana War
In 1993, Europe slapped heavy duties on imports of bananas from Latin America. However, as the US was investing in the industry, and many companies were US-owned, Washington was incensed and retaliated. The trade quarrel lasted six years, and culminated with the US filing several complaints against the EU with the World Trade Organisation (WTO). The US won the trade standoff, as in 2009 Europe agreed to gradually ease the tariffs. The fruit war drew to a close in 2012, with Brussels altering its rules.© AFP 2022 / ELMER MARTINEZA worker carries a box with bunches of bananas at the warehouse of a market in Tegucigalpa, 05 January 2006. 
A worker carries a box with bunches of bananas at the warehouse of a market in Tegucigalpa, 05 January 2006.
Chicken War
Back in mid-1962, the US switched to factory farming methods, allowing it to churn out poultry as a mass-produced commodity. As the US started to flood the market with cheap produce, six member nations of the Common Market – France, West Germany, Italy, Belgium, Luxembourg, and the Netherlands – responded with a raised common tariff on poultry. While the tariff ostensibly sought to encourage the development of German poultry growers, it resulted in exports of US poultry producers plummeting.Then-US President Lyndon Johnson in response announced hiked tariffs amounting to about $26 million on West German trucks, French brandy, dextrin, and Dutch potato starch.
