Former President Donald Trump has threatened a 200% tariff on French wines and champagnes in response to the EU’s newly imposed 50% tariffs on American whiskey. French officials and producers are frustrated, with calls for a more reasonable approach from the European Commission. The U.S. remains a key market for French alcoholic beverages, but recent trade tensions and potential tariffs could significantly impact exports. Trump’s use of tariffs aims to protect U.S. industries and generate federal revenue.
Trump’s Tariff Threats Against European Beverages
On Thursday, former President Donald Trump issued a stark warning to France and the European Union (EU), threatening to impose a staggering 200% tariff on champagne, wines, and other alcoholic beverages if the EU does not reverse its recently announced 50% tariffs on American whiskey.
This announcement from the EU came just a day prior, outlining tariffs on various American goods, including bourbon, motorcycles, and boats, as retaliation for the 25% tariffs imposed by the U.S. on steel and aluminum. These new tariffs are set to take effect on April 1, just one day before Trump’s proposed ‘reciprocal’ tariffs are scheduled to begin.
Reactions from French Officials and Producers
French exporters of wines and spirits expressed their frustrations, stating they are “tired of being systematically sacrificed for issues unrelated to ours.” They are hopeful that the European Commission will adopt a more realistic stance.
Laurent Saint-Martin, the French Minister for Foreign Trade, emphasized that France is “determined to retaliate” against any American measures, criticizing the trade war initiated by Trump.
Prior to the announcement of potential American countermeasures, the Italian Wine Syndicate forecasted that a 25% increase in tariffs would lead to a loss of 470 million euros for their producers, with the American market accounting for nearly a quarter of their exports.
Historically, a transatlantic agreement established in 1997 dismantled many tariff barriers, enabling a significant growth in trade, which increased by 450% until 2018, when the previous Trump administration initiated its first trade conflict.
The United States remains the largest international market for French wines and spirits, with sales in 2024 rising by 5% to reach 3.8 billion euros, notably due to the popularity of wines and cognac, according to data from the French Federation of Wine and Spirit Exporters.
Currently, most alcoholic beverages imported from Europe into the United States enjoy duty-free status, with only a minimal 2% tariff applied to sparkling wines, according to World Trade Organization (WTO) statistics.
However, spirits have faced challenges in 2024 due to an anti-dumping investigation by China targeting EU-produced wine brandies, including cognac and armagnac, resulting in a significant 25% drop in exports to the China/Hong Kong/Singapore region.
Since taking office again, Trump has utilized tariffs extensively, using them as leverage in negotiations with other countries, to protect American industries, and as a source of federal tax revenue. Canada, Mexico, and China, which are among the U.S.’s largest trading partners, have already felt the impact of Trump’s tariffs.
While Trump has previously threatened to target trade between the U.S. and Europe, he has not yet implemented specific measures against European products. His planned ‘reciprocal’ tariffs, starting April 2, aim to impose similar taxes on foreign goods entering the U.S. as those that American products face when exported to those countries.