The main news story this morning is the decision of the US authorities to impose a 220 per cent tariff on the imports of C-Series jets made by Bombardier in Northern Ireland. Bombardier is a major employer in Northern Ireland and 1,000 jobs are linked to the C-Series jet. This tariff has been imposed because Boeing complained that Bombardier gets unfair state subsidies from the UK and Canada. This tariff could triple the cost of the C-Series jet in the US, and you don't need a Ph.D to work out what that means: Bombardier will no longer be able to complete in the US market. This is protectionism, and protectionism always comes back to bite you when you least expect it.
In this excellent video, Daniel Hannan MEP highlights why protectionism doesn't work. As Dan rightly says, you only blockade your enemy. You certainly don't effectively prevent companies from other countries from competing in your market when you are friends. Pres. Trump has promised a quick US/UK free trade deal once we leave the European Union. I have no doubt that this is what he would like, however, he, and the US Department of Commerce which has imposed this tariff, have to understand that when it comes to free trade, you can't pick and choose winners. You either believe in it, or you don't.
Theresa May has said that she is "bitterly disappointed" about the ruling. I hope she goes further than merely expressing her feelings to the media and tells Pres. Trump that this ruling is completely unacceptable. Boeing wants to kill off competition in any way it can. If we wanted to, we could react in a tit for tat way. We shouldn't as that would mean more job losses and less competition in both countries, but it's how trade wars get out of hand. This needs to be nipped in the bud.
I sincerely hope that Pres. Trump orders the US Department of Commerce to think again. This ruling is not in the best interests of the UK or the USA, and ultimately, it's not in Boeing's best interests either.
Photo Credit: Yan Gouger