EU prepares retaliatory tariffs over Trump-era olive trade dispute

Brussels (Brussels Morning Newspaper) – It is expected that the EU executive will announce a list of US products it will target in retaliation for tariffs hit on Spanish black olives approved by Donald Trump’s administration. 

Euronews has reported that the European Commission is drafting a list of US products to target for retaliatory import tariffs in a continued trade spat over Spanish black olives. The dispute originated in tariffs hit on Spanish olives during Donald Trump’s first term at the White House in 2017 and now looks positioned to be an early issue impacting EU-US relations as he resumes his term as US president next year.

How did Trump-era tariffs impact Spanish olive producers?

In 2017 the US set anti-subsidy and anti-dumping duties of 30% to 44% on imports of Spanish black olives, asserting domestic producers were being hurt by EU subsidies provided to Spanish olive producers under the Common Agricultural Policy (CAP). The EU questioned the measures at the World Trade Organisation (WTO), leading to a lawful battle spanning over four years and formally ended in November 2021, when a first panel ruled that the US administration’s efforts were in breach of WTO rules.

The European Commission declared the US failed to address the WTO’s suggestions, for the authorisation of retaliatory tariffs.  The WTO is expected to debate and approve it during a meeting. “This would allow the EU to impose import tariffs on US products to offset the negative economic effects of the illegal US tariffs until the US complies with the WTO ruling on this matter,” the Commission spokesperson said.

Which US products could be targeted by eu countermeasures?

The EU is currently completing a list of specific products to be targeted by its countermeasures.

The general direction at the WTO level is that the complaining party should first strive to hit products in the same sector as those subject to unlawful duties. If that is not practicable or effective, it is feasible to take countermeasures on products in other sectors or protected by other WTO agreements. 

These new developments come amid more comprehensive concerns about trade relations, as ex-President Donald Trump has recently floated programs to impose blanket tariffs of up to 20% on European imports, reigniting worries of a transatlantic trade war. Any escalation could have wider implications, especially as Trump’s renewed trade policies threaten to set key European markets, including Spain, at risk.