U.S. Insists Europe Ease Barriers : Threatens to Impose Higher Tariffs on Wine and Cheese

The White House announced Monday that it will boost tariffs on several European agricultural products, including wine and cheese, unless the Common Market rescinds restrictions that it has imposed on the shipment of U.S. goods to Spain and Portugal.

The new European trade barriers, which the White House estimated would cost U.S. farm exporters as much as $1 billion, were imposed after Spain and Portugal joined the Common Market earlier this year.

The 12-member Common Market imposed quotas on Portugal’s imports of oil seeds and vegetable oils, required that 15.5% of Portugal’s grain imports be met by European suppliers and set higher levies on Spanish grain imports.

The White House moves, disclosed by officials here and in Santa Barbara, are aimed at persuading the Common Market to enter negotiations that would lift the trade barriers.

“We’re not looking for a trade fight,” a senior Administration official said.

He said that even the Europeans agree that new Portuguese quotas on oil seeds are illegal under international trade rules.

“There’s no amount of compensation,” he added, “that can be given the United States on patently illegal acts.”

Tariffs on Pasta

In nearly all cases, the U.S. government has reached agreement with the Common Market before actually imposing tariffs in retaliation against European agricultural trade barriers. But, last year, the Administration boosted tariffs on Italian pasta after the Europeans placed limits on imports of U.S. lemons.

That prompted the Common Market to further retaliate by imposing new barriers on walnuts.

U.S. officials said a list of European goods to be affected by the sanctions will be published later this week or early next week. One source said French and Italian wine and European cheeses probably will be among the first products singled out for retaliation.

“This is a much bigger issue than most of those in the past,” said Henry J. Voss, president of the California Farm Bureau Federation in Sacramento. “We hope the White House won’t back down with this one,” he added.

Separately, a White House statement said that U.S. Trade Representative Clayton Yeutter will investigate alleged trade violations by Taiwan in its automobile industry. A Taiwan-Toyota agreement will result in the export of up to half of the production of a new Toyota plant, much of which might be dumped in this country, U.S. officials said.

In addition, the United States also said it is investigating new European meat import inspection rules that threaten to eliminate as much as $125 million in annual U.S. meat sales to Europe.