The American Government has slapped $7.5 billion tariffs on goods coming from the EU to the USA.
The decision to impose the tariffs comes at the end of a 13-year long dispute at the World Trade Organisation over subsidies the EU gives to aircraft manufacturer Airbus, and are separate to tariffs imposed last year by America on EU steel and aluminium imports, and auto tariffs.
“It’s a pity this case is about aircraft state subsidies, Airbus in Europe and Boeing in the US, but the companies and businesses that suffer are basically thousands of European SMEs” – small and medium-sized businesses – “that have nothing to do with aircraft” says Petri Vuorio, Director of Trade Policy at the Confederation of Finnish Industries EK.
“Investors hate uncertainty […] and one main impact of these new tariffs is increased tension and uncertainty, with companies likely to postpone investments globally” says Vuorio.
Valio escapes the worst tariffs
Finnish dairy firm Valio is caught up in the latest round of tariffs.
The company has been exporting its cheese and butter to the USA since the 1970s and has around €70 million worth of sales there every year.
It now faces a 25% tariff increase which is paid by the importer then passed on to customers. If the customers don’t want to pay the new higher prices for Valio’s products then the importer could simply stop ordering them.
However, a quirk in the tariffs seems to work in Valio’s favour.
Imports to America of emmental cheese from Finland, France and Poland are somehow exempt from the tariffs. And that’s good news for Valio as emmental accounts for two-thirds of their US exports.
“I’m as surprised as anyone!” says Riitta Brandt, Valio’s Senior Vice President for Food and Trade Policy.
“Twenty-five percent, it’s quite a high tariff, but if this is the final decision we have have a big sigh of relief” she tells News Now Finland.
“The tariffs affect nearly all European cheeses and butter, and emmental is our biggest cheese export to the US, so the other cheeses are smaller. It would be very good for us that we could go on link normal, the price of our emmental wouldn’t go up” says Brandt.