Tug of war between Madrid and Washington over US tariffs

Spain’s wine and cheese exports to the US were worth over €1,000 million in 2018. [Shutterstock]

The Spanish government summoned the US ambassador to Spain, Duke Buchan, on Friday (4 October) to express its opposition to the new tariff increases announced by the Trump Administration. EURACTIV’s partner EFE reports.

In a statement, the Spanish executive “strongly” rejected the US measures, adopted in the wake of the WTO’s Airbus ruling. 

Spain’s acting Secretary of State for the EU, Luis Marco Aguiriano, delivered the message to the US ambassador and asked for urgent negotiations.

An agreement with Washington is necessary “to avoid damaging the spirit of collaboration and understanding that characterizes bilateral relations,” the statement added.

In case the US rejects the dialogue, the Spanish government will react “immediately with firmness and clarity” in defence of Spanish interests by activating all legal measures available in collaboration with the European Commission and other EU countries”..

Τhe US administration decided last week to impose 10-25% tariffs on European goods after a World Trade Organisation (WTO) ruled in their favour in a dispute over subsidies for Airbus, the European aircraft manufacturer.

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EU wine producers said that the loss in US market share for French, German, Spanish and UK operators “would take a long time to recover”.

Similarly, Europe’s food and drink lobby group, FoodDrinkEurope, stated that “Europe’s food and drink manufacturers, 99% of which are small and medium-sized enterprises, could end up paying the price for a dispute originating in a completely unrelated sector.”

EU help

In the meantime, Spain is planning to ask the European Union for financial aid, to mitigate the severe economic damage to its agricultural sector.

On Friday, Spain’s Minister of Agriculture, Luis Planas, said Madrid would ask the EU executive to mobilise EU aid for crises in the agricultural sector, the activation of a mechanism that covers the financial costs of olive oil storage by companies, as well as measures to promote the Common Agricultural Policy (CAP) in third countries.

Spain also plans to strengthen the international efforts made by the official institute for the promotion of trade abroad (ICEX) with a particular focus on Spanish agrifood products listed on the US fresh round of tariffs.

Spain’s wine and cheese exports to the US were worth over €1 billion in 2018.

European Commissioner for Trade, Cecilia Malmström said both the EU and the US have been found at fault by the WTO dispute settlement system for continuing to provide certain unlawful subsidies to their aircraft manufacturers.

“Our readiness to find a fair settlement remains unchanged. But if the US decides to impose WTO authorized countermeasures, it will be pushing the EU into a situation where we will have no other option than do the same,” she added.

[Edited by Sarantis Michalopoulos and Benjamin Fox]

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