The United States and Europe traded threats and accusations on Saturday in a fresh escalation of the row over subsidies for aircraft rivals Boeing and Airbus that risks souring transatlantic ties. The two sides last year launched competing litigation at the World Trade Organisation (WTO) but had agreed on January 11 to a three-month truce in the hope of reaching a negotiated settlement on eliminating subsidies to the aviation titans. European Union Trade Commissioner Peter Mandelson rebuffed U.S. accusations that Brussels was blocking talks, saying that Washington was responsible for the apparent collapse of negotiations. "I regret this unilateral action in breaking off the negotiations," Mandelson said in a statement. "I am happy to return to the negotiating table." His remarks followed a telephone conversation on Friday, which an EU official said was abruptly ended by outgoing U.S. Trade Representative Robert Zoellick after Mandelson mapped out plans for a phased approach to a deal. Zoellick's spokesman, Rich Mills, retorted: "It was commissioner Mandelson who terminated yesterday's call." Nevertheless, Mills took a more conciliatory line, saying Washington was ready to resume talks, negotiate beyond the original April 11 deadline if need be and even pursue the phased approach proposed by Mandelson. "The problem is that over the last two months the EU has been focused more on manoeuvring than on negotiating the core substance," he said by telephone from Washington.
