Brussels, 12/01/2001 (Agence Europe) - The consultations in Washington between the Union and the United States on their aeronautical differences was described in Brussels, on Friday, as "useful". It was not only question of the transparency and legality of the aid that each obtains for its own industry, Airbus and Boeing respectively, but also the pressure exerted on third countries for the purchase of certain types of aircraft, and mainly pressure by Americans on Israel in order to sell it its hunter fighter planes, said one well-informed source. Talks may resume in July in Brussels, with a view to preventing a large-scale trade war.
The meeting, which took place on Thursday at expert level, covered several problems linked to the 1992 transatlantic agreement on aid to the construction of civil aircraft, and mainly:
1) The transparency of indirect aid to Boeing. European questions are more specifically raised on the funding that the Seattle aircraft manufacturer receives from the Pentagon in order to develop military aircraft (these technologies then being used for civilian carriers), with an average of around 7.5% of the turnover of the company in 1998, according to a study carried out in Brussels, or well beyond the ceiling of 3% agreed by common accord. Further details will be forwarded to Washington at a later date.
2) The legality of loans announced for the development of the largest carrier in the world, the Airbus A380, a project whose cost is evaluated at $10.8 billion by the consortium to which 9 Member States have promised to contribute. "What we are doing is far more transparent than what the Americans are doing", it is said in Brussels, with emphasis on the fact that aid to Airbus is in the form of fully or more than fully reimbursable loans. "For every pound put forward by the British Government for the development of the A380, the taxpayer received two pounds back", it is recalled over and over again. The Americans, for their part, did not wish to prevent the launching of the European super-jumbo jet. "We simply want to guarantee that public funding will be in commercial terms and prevent a trade war", stressed one Washington official the day after the meeting. He went on to state: "Airbus is a mature company that currently holds 50% of the market and there is no reason why it should not receive subsidies for the A380".
3) Compatibility with the 1994 multilateral agreement on subsidies (whereby the US Foreign Sales Corporations regime had been denounced by the Union and recognised as unlawful by the WTO). "For our part, it is out of the question to question the bilateral agreement. These two agreements are perfectly compatible. That of 1992 sets out policy in government aid far more strictly than the WTO agreement", argued the Europeans.
Experts also weighed up the "pressure exerted by the third countries for the purchase of certain kinds of planes", mainly "the fact of linking US foreign aid to the purchase of hunter fighter planes by the Hebrew State", one well-informed source stated. Nonetheless, says the same source, "one cannot say there were no threats during this session. We opened dialogue as the American interests and our own are similar, in terms of prosperity and employment: Boeing is present in Europe and Airbus in the United States, so it is better to come to an agreement rather than fight each other".