Biden And The EU Agree To A Truce In A 17-Year-Long Fight Over Aircraft Subsidies

President Biden on Tuesday announced a truce in a long-running trade war with the European Union, saying it was time to put aside the fight and focus together on the growing trade threats posed by China.

His Brussels stop at EU headquarters was the latest part of his mission to mend ties with allies that were strained by the go-it-alone approach of his predecessor before he sits down with Russian President Vladimir Putin in Geneva.

Biden was also set to launch a trade and technology council during his session with Ursula von der Leyen, president of the European Commission, and Charles Michel, president of the European Council.

The high-level group will work on strategies to have common standards for new technologies like artificial intelligence and biotechnology, regulations for technology platforms and export controls, and proposals to reform the World Trade Organization — all areas where China poses a significant challenge.

"The notion here is that the United States and Europe laid the foundation for the world economy after World War II and now has to work together to write the rules of the road for the next generation, particularly in the areas of economics and emerging technologies," a senior administration official told reporters traveling with Biden.

The United States and EU have fought for 17 years over the use of tools like subsidized loans and tax breaks to support the aerospace sector. In 2019, the World Trade Organization ruled that both sides were breaking the rules.

The WTO authorized the United States to apply tariffs on $7.5 billion of imports from the EU per year – tariffs that affected not only aircraft, but items like wine and cheese. At the time, former President Donald Trump called it a "big win."

The WTO also allowed the EU to apply tariffs on $4 billion of U.S. exports.