US Illegally Subsidized Boeing, WTO Rules

Airbus thinks $45B in retaliation is 'realistic'
By Kevin Spak,  Newser Staff
Posted Jan 31, 2011 12:39 PM CST
US Illegally Subsidized Boeing, WTO Rules
A Boeing 787 test plane taxies past other Boeing aircraft while moving into position for take off in this Oct. 4, 2010 file photo.   (AP Photo/Elaine Thompson, file)

The US has given billions of dollars in illegal subsidies to Boeing, the World Trade Organization formally ruled today after months of investigation. The WTO has now found that both Boeing and Europe's Airbus received illegal aid from their respective governments, leaving the US and European Union to negotiate a settlement, according to the Wall Street Journal. Each government will be able to levy trade sanctions to offset any economic harm suffered.

“We expect at least $45 billion as a realistic figure for retaliation,” said an Airbus spokeswoman. “We expect the WTO to clearly show at the end that the grants given to Boeing have a bigger impact … than any loan to Airbus.” But a Boeing VP called that “a tortured reading and perhaps a misreading of how the process works,” saying the report “rejected almost all of Europe’s claims.” The WTO found that the Pentagon and NASA gave Boeing $16 billion between 1989 and 2004; the company also received tax breaks from Kansas, Washington, and Illinois, and billions more in additional aid. (Read more Boeing stories.)

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