Biden eases trade friction with EU ahead of Putin summit

President Joe Biden on Tuesday moved to end a long-running dispute with the European Union over subsidies for aircraft manufacturers, a major breakthrough in the U.S.-EU trade relationship that comes on the eve of his highly anticipated meeting with Russian President Vladimir Putin.

The announcement that the two sides reached resolution in a 17-year dispute over how much of a government subsidy each can provide for its aircraft manufacturing giant — Boeing in the United States and Airbus in the EU.—came as Biden met with European Council President Charles Michel and European Commission President Ursula von der Leyen.

With the move, Biden eases a major point of tension in the trans-Atlantic relationship at a moment he’s seeking to marshal widespread European support for his efforts to counter Russia prior to his Wednesday meeting in Geneva with Putin.

U.S. Trade Representative Katherine Tai told reporters that the agreement calls for a five-year suspension of the aircraft tariffs, and stressed that it was time to put aside the fight and focus on China’s economic assertiveness.

“Today’s announcement resolves a longstanding trade irritant in the U.S.-Europe relationship. Instead of fighting with one of our closest allies, we are finally coming together against a common threat,”″ Tai said. “We agreed to work together to challenge and counter China’s non-market practices in this sector in specific ways that reflect our standards for fair competition. “

She added that the tariffs could be reimplemented if the U.S. determines U.S. companies are not able to “compete fairly” with the EU’s. The tariffs had been temporarily suspended on March 11 for four months, and the new agreement will officially go into effect on July 11.