Happy Ngozi Okonjo-Iweala WTO Chief eudebates with President Michel
A senior World Trade Organization spokesman told CNBC that Europe and the US should sit down and agree to resolve subsidy disputes involving Airbus and Boeing.
Last week referees The WTO gave the administration of President Donald Trump the power to charge billions on imports of European goods for what they call illegal subsidies given to the aircraft manufacturer Airbus by the European governments of Germany, France, Spain and the United Kingdom..
Trump subsequently named the decision «a good victory».
The EU has its own claims to WTO – according to European authorities, American aircraft manufacturer Boeing receives unfair financial aid from the US federal government.
EU said it wants to negotiate a way forward with Washington by establishing a new aviation subsidy regime.
WTO CEO Roberto Azevedo told CNBC in Geneva on Thursday that he hopes both sides agree to negotiate.
«I hope the parties sit down and talk and find an agreed solution, because the last thing we need at the moment – it is an escalation of tariff barriers and trade restrictions», – said Azevedo.
The head of the WTO said that imposing a duty on imports tends to create «Domino effect», obstructing trade.
«You cannot be expected to impose tariffs and barriers, and everyone else will sit and calmly applaud. They will answer», – he said.
Britain and Northern Ireland are now just three weeks from the next deadline (October 31), which the US government insists will lead to the UK’s withdrawal from the European Union..
No Brexit deal has been agreed upon either in the UK Parliament or between London and Brussels.
Azevedo told CNBC that after Brexit without a deal, the UK can immediately start trading under WTO rules. However, he warned that any attempt to invoke an obscure trade law – Article 24 of the General Agreement on Tariffs and Trade (Gatt) – to ensure the continuation of free trade will fail..
«Article 24 says: if you have an agreement, you will have time to implement it. But if no agreement is reached, Article 24 will not apply by definition», – said the head of the WTO.
Azevedo said that Brexit «without reference negotiations» hurt the growth of both the EU and the UK.
«It won’t stop, but there will be consequences. More barriers, more tariffs and the like negatively affect the economy», – he said.