BERLIN (Reuters) - Aerospace officials of the European countries where Airbus makes its planes will push for a delay to the start of the European Union’s Emission Trading System to avert retaliation from China, officials said on Tuesday.
“Airbus has left us with no doubt that the threat of retaliatory action is a clear and present danger to its order list,” Michael Fallon, new business minister in Britain, said at the ILA Berlin Air Show on Tuesday.
China has threatened retaliation - including impounding European aircraft - if the European Union punishes Chinese airlines for not complying with its emissions trading scheme ETS.L, intended to curb pollution.
The dispute between China and the EU froze deals worth up to $14 billion, though China signed an agreement with Germany for 50 Airbus planes worth over $4 billion during Chancellor Angela Merkel’s visit to Beijing last month.
If the dispute is not resolved, Airbus will have to cut its production target for the A330 “pretty soon”, Airbus Chief Executive Fabrice Bregier said late on Monday.
Fallon and his counterparts will urge their national governments to push for a suspension of the start of the EU’s ETS, slated for April 2013, until the next general meeting of global trade body ICAO - the International Civil Aviation Organization - in September 2013.
“We are very much aware that the clock is ticking. We have very little time left,” Fallon said following a meeting of the so-called Airbus EAD.PA ministers of Britain, France, Germany and Spain.
The German minister in charge of aerospace policy, Peter Hintze, said no decision had been made yet on what a global agreement on emissions trading could look like.
“The goal must be that the contribution of aviation is not just limited to one continent but is agreed worldwide,” he said.
Airbus sales chief John Leahy suggested one possible solution could be that all airlines around the world pay a tax to ICAO for carbon emissions, regardless of where they are based. (Editing by David Holmes)