The WTO had ruled that Boeing was given an unfair edge over Airbus by tax breaks from Washington state. But after the WTO decision, the state repealed the tax breaks, making the EU's complaint obsolete in the view of U.S. officials. However, this is not an isolated case. EU leaders have expressed frustration that the US this year put 25% tariffs on European cheeses and wine.

Here is how the tariffs impact North Carolina Agriculture: 

Impact on Sweet Potatoes - The EU imports approximately 60% of their sweet potatoes from the US, about 90% of which is from North Carolina. If the tariff issue is not resolved shortly, the EU will still need to purchase from North Carolina. But with higher prices, we should expect slightly reduced demand and increased competition, especially from Spain.

Impact on Tobacco – The EU imports approximately 20% of US tobacco. In 2019, Dec-Mar saw the most EU tobacco exports.

Impact on other NC Agricultural Products – Other products listed include cotton, peanuts, fish and specialty foods. North Carolina is not a major EU supplier of those products. International markets will adjust, moving competitive nations to Europe and US products filling the void. Specialty foods, already priced at a premium, will have increasing difficulty competing in the European market.

Potential Resolution – The EU has gained bargaining power in future trade negotiations with these additional tariffs. The Biden administration should take a couple of months to form a trade team. Negotiations should start at best in March. The question is how the new administration prioritizes the EU and these products? Tariffs are easy to administer, but very difficult to negotiates away.

What can North Carolina do? – There is little that can be done at the state level to influence international trade negotiations. North Carolina can take this opportunity to develop new markets, such as in the Middle East and Southeast Asia. It will take years to reach the level of EU exports, but it will diversify markets for the future. Tobacco will have difficulty finding significant new markets.