The United States and the European Union have been involved in trade disputes over the past few years, but a mini-deal announced on Friday marked a critical de-escalation in transatlantic tensions.
The European Commission, the EU’s executive arm, has agreed to end tariffs on frozen and live lobster in the United States for the next five years, intending to make this change permanent.
The deal has yet to be approved by other EU institutions, but it is a step welcomed by the struggling industry, which has had to deal with a trade war with China and fewer sales to the EU since the latter signed a major trade agreement with Canada.
“The Commission and the United States see this agreement as a good basis and a first step to further improve EU-US trade relations,” a European Commission spokesperson told CNBC on Sunday.
The same spokesperson hinted that Friday’s deal could pave the way for a deal on aircraft subsidies.
The two sides have challenged the subsidies given to Airbus and Boeing, which the World Trade Organization (WTO) has deemed non-compliant with its rules. As a result, the United States has already put tariffs in place on European products, and the EU is awaiting a WTO ruling, due later this summer, on the possibilities of retaliation.
“The package builds on the commitment of both sides to find a negotiated solution to the long-standing aviation dispute,” the spokesperson said.
The US approved tariffs on steel and aluminium in the EU in 2018; opened an investigation into European plans to impose a tax on digital giants; and slapped 25% levies on some EU products for pre-Airbus state subsidies. However, the United States and the EU said Friday’s deal was the first time in more than 20 years that they had decided to cut tariffs.
Their recent announcement could get them out of this long-standing deadlock on aircraft subsidies.