Hopes pinned on incoming US president Joe Biden to cool EU-US trade and tariff tensions

Thu 12 Nov 2020
Posted by: Noelle McElhatton
Trade News

trade war

US president-elect Joe Biden is being called on to cool tensions between the EU and US following the escalating trade wars under Donald Trump’s presidency, the Independent reports.

French trade minister Franck Riester said the US, under Trump, threatened global commerce by blocking the appointment of the World Trade Organization’s next director general. He urged Biden to break the logjam after he becomes the 46th US president on 20 January 2021.

Air dispute latest

Riester’s plea came as the EU was set to impose $4bn of tariffs on the US in the latest development in the long-running Airbus-Boeing dispute.

The BBC said the taxes, authorised by the WTO last month, went into effect from Tuesday and affected products such as tractors, ketchup and orange juice. The new tariffs follow a ruling by the WTO last year that the US could levy $7.5bn of tariffs on the EU over the dispute.

EU Trade Commissioner Valdis Dombrovskis said the EU wanted to see both sides remove their respective tariffs, and that Joe Biden’s election could help “reboot” talks.

The EU said its decision to move forward with tariffs was due to the Biden trade team being unlikely to be in place until February or March 2021.


“Removing these tariffs is a win-win for both sides, especially with the pandemic wreaking havoc on our economies,” said Dombrovskis.

Around 16 million workers have jobs supported by EU-US trade, but tariffs in the past four years have hit companies across a range of sectors.

The Express reported that German economy minister Peter Altmaier hoped the Biden administration “will contribute to world trade relations being more rules-based, being more multilateral, being less protectionist in the future”.

Drinks business woes

Meanwhile a group of 20 drinks industry trade associations has called on both sides to end the  “application of excessive and unwarranted tariffs”, according to Spirits Business. US tariffs have led to a 34% decline in Scotch Whisky exports, while US whiskey exports to the EU have fallen 41% since a 25% tariff was introduced in 2018.

“The US and EU need to return to the negotiating table without delay,” the group’s statement said.

Risks and upsides

However, Politics.co.uk said that trade watchers should temper their hopes about a Biden presidency. While the president-elect’s arrival should herald a return to the style of trade diplomacy the UK is more comfortable with, it will not change fundamental US interests.

Dmitry Grozoubinski, director of ExplainTrade, said that “politically, entering into FTA negotiations with the UK carries as many risks as upsides” for Biden, who “risks being bogged down in contentious negotiations”.