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The US says it will delay imposing retaliatory duties on an array of EU goods as the trading partners hash out a possible fix to the long-standing dispute over hormone-treated beef. The news came on 12 March when the office of the US Trade Representative (USTR) announced that the 23 March tariff implementation date, set under former USTR Susan Schwab, would be pushed back by one month.
The US maintains that the retaliatory duties were designed to push the EU into meaningful negotiations (see Bridges Trade BioRes, 23 January 2009, http://ictsd.net/i/news/biores/38544/). And while no final resolution is immediately expected, some observers say a tentative agreement could be reached.
“USTR is currently in discussions with the European Commission on a possible interim solution that would provide benefits for US beef producers,” USTR spokesperson Nefeterius McPherson said earlier this week. “These discussions have made progress, although several important issues remain to be resolved. USTR has decided to delay the trade action in order to give this process every possibility of success.”
European Trade Commissioner Catherine Ashton welcomed the news, saying that she feels optimistic about the way things are progressing. “The EU and U.S. are engaged in negotiations to find a way forward on this issue, and I am confident we will find a solution very soon,” Ashton said in a statement. Ashton is expected to travel to Washington to discuss the matter on 23 March.
The beef issue is arguably the best known and one of the longest running trade disputes between the two trade partners. At the centre of the controversy is whether the EU’s ban on imported hormone-treated beef is in compliance with the WTO Agreement on Sanitary and Phytosanitary Measures, known as the SPS Agreement. That Agreement governs the use of health and safety-related trade barriers, and allows such restrictions to be justified based on scientific evidence or other pertinent information.
Canada and the US maintain that the EU ban is unfounded and their position has been supported by the WTO. In July 1999, the US established retaliatory sanctions on a specific list of EU goods in response to the ban. In January 2009, the outgoing Bush Administration broadened the list of products to include goods such as meat, chewing gum, chocolate, certain jams, and other goods. The so-called ‘carousel’ sanctions, which would be applied on a rotating basis, have been identified as an issue of particular concern by Commissioner Ashton.
Other trade issues, such as the EU’s bans on US chicken sanitised with chlorine and the harvesting of genetically modified crops have also been causing friction between the two trading partners recently (see Bridges Trade BioRes, 23 January 2009, http://ictsd.net/i/news/biores/38523/ and 6 March 2009, http://ictsd.net/i/news/biores/42458/).
Most recently, the EU raised the ire of the US by introducing new tariffs on American biodiesel, arguing that the fuel is being subsidised and dumped (see Bridges Trade BioRes, 6 March 2009, http://ictsd.net/i/news/biores/42454/).
ICTSD Reporting; “USTR announces delay of trade action in beef hormones dispute,” EU PRESS RELEASE, 12 March 2009; “U.S., EU eye possible fix to long-standing beef war,” REUTERS, 16 March 2009; “EU welcomes delay to US trade sanctions,” FINANCIAL TIMES, 13 March 2009.
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