Trade relations between the U.S. and the European Union (EU) hit another rough patch in recent years. Former President Donald Trump and his administration threatened to impose additional duties on EU exports worth $11 billion in retaliation for the bloc granting aircraft manufacturer Airbus illegal subsidies.
The World Trade Organization (WTO) ruled that the subsidies had an adverse impact on the U.S. by causing an Airbus rival, Boeing Co. (BA), to lose sales. The WTO also ruled that the bloc failed to comply with its rulings, paving the way for the U.S. to impose countermeasures. In 2019, the U.S. was awarded $7.5 billion as compensation. In 2020, the EU was authorized to impose tariffs of $4 billion due to illegal subsidies by the U.S. government to Boeing.
The list of EU products covered by additional duties included aircraft, helicopters, and fuselages from France, Germany, Spain, and the U.K., in addition to a variety of cheeses, fruits, jams, wines, and yarns from any of the 28 member states of the bloc.
In July, former President Trump met with European Commission President Jean-Claude Juncker at the White House to address improving trade relations. (Trump had threatened to impose a 20% retaliatory tariff on car imports from the EU) During the meeting, the two regions discussed a new trade deal that would remove tariffs on non-auto industrial goods.
The EU is one of America’s largest trading partners, accounting for $658 billion worth of goods trade in 2020. While the U.S. exported $237.9 billion worth of goods from the EU, imports from the EU. amounted to $420.1 billion, making the trade deficit $182.1 billion, the highest ever on record, according to the U.S. Census Bureau.
Top Imports From the European Union
At the top of the list for imports from across the Atlantic Ocean are pharmaceuticals. In 2019, the U.S. pharmaceutical imports from the EU were equal to $77 billion.
Machinery, excluding electrical and computer equipment, was the second-largest component of EU imports for the U.S., at $75.6 billion in 2019. This category includes agricultural and industrial machinery, as well as engines and turbines.
Motor vehicle-related imports were equal to $44 billion and accounted for 9.7% of all goods that were imported from the EU in 2019. This category includes cars, motor vehicle bodies, and trailers, and car parts.
Top Exports to the EU
In 2019, the U.S's largest export to the EU were aerospace products and parts, at $35.7 billion. That was followed by mineral fuels, worth $28.9 billion, and machinery, worth $26.4 billion.
Top State Trade
In terms of the exports of goods, in 2020, Texas ranked highest in terms of the export of goods to the EU, at $37.9 billion. Texas was followed by California, at $30.0 billion. South Carolina, Illinois, and Georgia came next in line, with trade volumes of $9.6 billion, $8.8 billion, and $8.3 billion, respectively. Wyoming, Montana, and Hawaii are the states that saw the lowest volume of trade of goods with the EU in 2020.