The British government is reportedly taking a public position that doesn’t reflect their private thinking on the dispute.
A report from Bloomberg says the British government (behind the scenes) believes Canada is mostly to blame for the decision of the U.S Commerce Department to impose 220% tariffs on the Bombardier C-Series.
As the report notes, “Publicly, the British government has said that the U.S. imposition of punitive duties on Bombardier is disproportionate, and Prime Minister Theresa May even lobbied U.S. President Donald Trump unsuccessfully to try to prevent it.” Yet, “Privately, it believes that Canada has overstepped the mark in aid to Bombardier, according to two officials who declined to be named while talking about an ongoing dispute. Bombardier spokesman Simon Letendre declined to comment.”
The British government is concerned about the dispute, as there are over 4,000 jobs that could be lost at the Bombardier plant in Belfast. That plant constructs the wings for the C-Series planes, and the loss of those jobs could cause a rift in the fragile U.K. government, as Theresa May is reliant on 10 seats in the region to sustain her tenuous hold on parliament.
The report points out that May has issued tough threats against Boeing, but those threats may be empty:
“She even went so far as to say the U.K. might not consider Boeing for future contracts, but that might turn out to be an idle threat as there are thousands of jobs also tied to the U.S. aircraft maker. Of the 220 per cent subsidies identified by the U.S., 200 per cent was due to Canada, one of the British officials said.”
Meanwhile, “Bombardier’s case rests on the fact the government of Quebec’s aid package was not a subsidy — but rather a direct investment in the CSeries program. In exchange for a $1 billion cash infusion, the province received a 49.5 per cent stake in the C Series.”
The C-Series could face further issues, as the Commerce Department is set to make a decision Wednesday on whether to slap the Bombardier plane with anti-dumping duties.
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