The European Union and China, along with five others, are criticizing President Trump's $16 billion trade relief program claiming it may violate world trade rules. Specifically, the assistance program could exceed the nation's WTO subsidy commitments and influence U.S. planting decisions, according to Bloomberg News.
Last month, USDA announced new Market Facilitation Program funds, up to $16 billion, after the U.S. and China failed to reach an expected agreement in trade negotiations. Retaliatory tariffs from China and others have caused harm to U.S. farmers, focusing on U.S. farm products.
However, the U.S. has not officially notified the WTO of the relief program, and will now have the opportunity to respond to the questions from other nations. The European Union has questioned the timing and eligibility criteria of the program, and whether the measures would qualify as WTO-permitted subsidies.
The U.S. may be able to craft a WTO-compliant program, if subsidies don’t exceed the U.S.-WTO commitment to cap trade-distorting subsidies at $19 billion per year.