WTO rules Boeing takes illegal subsidies
According to Airbus, a confidential report by the World Trade Organization (WTO) to be released in the next few weeks will show that Boeing allegedly received illegal subsidies from the U.S. government.
Spokesmen for the manufacturer say the WTO ruling will find that Boeing received $7 billion in federal, state and local subsidies, which “distorted competition within the aviation industry, directly resulting in significant harm to the European aerospace industry.” The subsidies allegedly come from the U.S. Department of Defense, NASA, and the state of Washington and the city of Everett. According to Airbus’s figures, these subsidies cost the manufacturer $45 billion in lost sales.
Boeing had previously alleged that Airbus was taking illegal subsidies from European nations. The WTO ruled in June that this money was given to the company under a Reimbursable Launch Agreement.
Initially, the European Commission had claimed Boeing received more than $15 billion in illegal subsidies. Boeing officials said the WTO ruling is a partial victory, even as Airbus chose to view the ruling as proof of Boeing’s illegal acts.
“The WTO report is still confidential, but news stories citing government officials have given us a glimpse into its conclusions. It appears the WTO has rejected the vast amount of European claims against the United States,” said Ted Austell of Boeing. “There is nothing on the U.S. side that comes even close to the billions of taxpayer dollars that Airbus gets to develop new airplanes.”
Results of the WTO report still haven’t been officially confirmed. The only thing that’s for sure is that this protracted battle concerning government subsidies is far from over.
“We expect the WTO dispute to carry on for several more years and as in all trade conflicts, a resolution will only be reached through negotiations,” Airbus’ Rainer Oher said in a statement. “The myth that Boeing doesn’t receive government aid is over and we hope this sets the tone for balanced and productive negotiations going forward.”