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Britain caught in crossfire of trade spat between Boeing, Bombardier

The C Series aircraft is shown in Mirabel, Quebec on September 16, 2013

AF/AFP/Getty Image

Britain, caught in the crossfire of a damaging trade dispute between airplane makers Boeing Co. and Bombardier Inc., said on Sunday it would fight to protect thousands of jobs put at risk in Northern Ireland.

Trade Minister Liam Fox said Britain was working to find a resolution after the United States last week responded to a Boeing complaint by imposing a 220-per-cent preliminary duty on Montreal-based Bombardier's C Series jets, wings for which are made in Belfast.

"We've said that we will fight our corner," Mr. Fox told the annual Conservative Party conference. "We've been caught in the crossfire of a much larger dispute."

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Read more: Bombardier under fire - How the U.S. targeted the C Series (for subscribers)

Barrie McKenna: U.S. war on Bombardier's C Series summons ghost of Avro Arrow (for subscribers)

Freeland calls Bombardier duty ‘aggressive’ as NAFTA round ends (The Canadian Press)

"It worries me that we're seeing a rise in protectionist behaviour … the OECD itself has pointed out protectionism always ends badly," Mr. Fox said, referring to the Organization for Economic Co-operation and Development. "If we can get them to have a resolution, which is what we are trying to do quietly, so much the better."

The tariff, which will take effect only if the U.S. International Trade Commission backs Boeing in a final decision expected in 2018, has dealt a major blow to the Canadian company's flagship project.

It has also cast a huge shadow over Northern Ireland, where Bombardier is by far the most important manufacturer and a pillar of Belfast's economy, employing 4,200 people and supporting thousands more in the supply chain.

And it also undermines the assurances by Brexit campaigners such as Mr. Fox that free trade and London's close ties with Washington will drive Britain's prosperity and global influence after it leaves the European Union in 2019.

James Brokenshire, the British minister responsible for Northern Ireland, echoed Prime Minister Theresa May in saying that Boeing was not behaving in a way the British government would expect a long-term defence partner to behave.

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Ms. May and other senior ministers have been highly critical of Boeing, suggesting it could miss out on future defence contracts, after the row put into jeopardy the local economy in Northern Ireland, home to a small party that Ms. May relies on to govern in Westminster.

"I say to Boeing this case is unjustified and unwarranted. This action is not what is expected of a long-term partner to the U.K. They need to get round the table and secure a negotiated outcome to this dispute quickly," Mr. Brokenshire said.

Ms. May has warned that Boeing was undermining its commercial relationship with Britain and has spoken to U.S. President Donald Trump on the issue.

However, Ms. May is unlikely to retaliate against Boeing, which says the firm and its suppliers account for more than 18,700 jobs in the United Kingdom. Mr. Fox implied the government was working behind the scenes to find a resolution.

Northern Ireland is the poorest of the United Kingdom's four parts and is mired in political difficulties after emerging from decades of armed sectarian conflict.

Boeing, the world's largest aerospace company, says it is upholding trade rules and not trying to damage the C Series. It accuses Canada and Britain of unfairly subsidizing Bombardier and says Bombardier has illegally dumped its products in the U.S. single-aisle airplane market out of desperation. "The support that the U.K. provided to the Bombardier operation in Belfast was and remains compliant with international requirements," Mr. Brokenshire said.

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