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US claims win in subsidies row

written by australianaviation.com.au | March 24, 2010
photo - Paul Sadler
photo - Paul Sadler

The US and Boeing have claimed victory in its battle over subsidies given by European governments to Airbus after the WTO handed down its final ruling on the long running dispute.

Boeing issued a statement on March 23 lauding the decision as “good news” for the US aerospace industry, while also attacking its rival. “Government subsidies have been used to support the creation of every Airbus product, including the A330/A340, which received more than US$5bn (A$5.45bn) in development aid, and the A380, which received US$4bn (A$4.36bn) in subsidies. Those and other European government subsidies to Airbus have significantly distorted the global market for large commercial airplanes, causing adverse effect to Boeing and costing America tens of thousands of high-tech jobs,” the company said.

Airbus responded by issuing its own statement, which said that it had learned that 70 per cent of the claims made by the US against the EU were rejected by the WTO panel, while it also reaffirmed reimbursable launch aid as a legal method of financing aircraft research and development. It added that the ruling in no way affects future funding for research and development on the A350, and that US requests to include that program “were specifically rejected.”

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“These results are in stark contrast to Boeing’s enthusiastic expectations announced only last night in a statement by the company,” said the company. “Airbus, the EU and the Member States will closely analyse today’s ruling in advance of a possible review by the WTO appellate body.”

Airbus also hit back at Boeing’s rhetoric, noting that a counterclaim filed by it and the EU over subsidies given to Boeing through defence contracts and various tax concessions is expected to be reported on in June. “Boeing’s recent WTO enthusiasm is unlikely to survive WTO confirmation that the B787 is the most highly subsidised aircraft program in the history of aviation,” it said.

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