The European Union has agreed to end tariffs worth $111 million on the import of live and frozen lobsters from the United States, a move aimed at de-escalating trade tensions between the two.
In return, the U.S. will eliminate its tariffs on $160 million of imports from the 27 member trading bloc, including prepared meals.See Also: Trade News
The deal has not yet been approved by all the other European institutions, but is seen as a critical first step in unwinding 20 years of trade tensions. The decision marks the first time tariffs have been removed by either side in that time period.
“We intend for this package of tariff reductions to mark just the beginning of a process that will lead to additional agreements that create more free, fair and reciprocal transatlantic trade,” U.S. Trade Representative Robert Lighthizer and European Trade Commissioner Phil Hogan said in a joint statement.
While tariffs on packaged Spanish olive oil imports as well as imports of some types of table olives from France and Spain will remain in place, negotiators on both sides of the Atlantic are confident that this de-escalation will not be an isolated incident.
A European Commission spokesperson hinted to CNBC that this negotiation could be the first step in bringing the two sides to the table to discuss aircraft subsidies given to Airbus and Boeing.
On behalf of the U.S., the World Trade Organization (WTO) has already ruled that the E.U. illegally subsidized Airbus and awarded $7.5 billion of countermeasures. The WTO is also expected to rule in favor of the E.U. on a similar case regarding subsidies provided to U.S. manufacturer, Boeing. That ruling is expected to come later in the summer.
“The Commission and the U.S. see this agreement as a good basis and first step for further improving E.U.-U.S. trade relations,” the spokesperson told CNBC. “The package builds on both sides’ commitment to find a negotiated solution for the longstanding aircraft dispute.”