Depending on the outcomes of various EU investigations into potential Chinese state subsidies, there’s speculation that China might impose retaliatory tariffs on European wine imports.
Chinese officials have hinted at the possibility of imposing punitive import duties on EU wines and other goods, pending the findings of several European Commission probes into alleged Chinese state subsidies across different business sectors.
A cautionary message posted on a Chinese social media account closely linked to state media featured a legal expert mentioning wine and dairy as two agricultural sectors that could face targeting. This alert was also relayed by the China Chamber of Commerce to the EU via X, formerly Twitter.
In a press release dated May 18, the Chamber stated that it had received information indicating that China possesses “sufficient countermeasures” should the EU persist with its investigations. This development underscores the strained trade relations between the two parties and occurs as the EU is anticipated to conclude an inquiry into potential Chinese state subsidies within the electric vehicle sector.
Earlier this year, China initiated a formal anti-dumping investigation into brandy imported from the EU. Notably, China is a significant market for Cognac producers, and discussions regarding the probe may have taken place during Chinese President Xi Jinping’s visit to French President Emmanuel Macron in early May. Macron hosted a state dinner at the Elysée Palace in honor of Xi, featuring drinks such as Hennessy XO, Martell Cordon Bleu XO Cognacs, Château Lafite Rothschild 2007, and Maison Edouard Delaunay’s Corton-Charlemagne Grand Cru 2020, as reported by Vitisphere publication.
China ranked as the third-largest market for French wine and spirits exports by value in 2023, trailing behind the US and UK. Despite reaching nearly €1.2bn in shipments to China last year, representing a 6.2% decrease compared to 2022, French wine and spirits export agency FEVS highlighted the significance of this market.
The past few months have seen China announcing the removal of additional tariffs on Australian bottled wines, which previously exceeded 200%, effectively shutting out Australian wineries from the Chinese market. Additionally, European wines were subjected to higher tariffs by the US amid a longstanding dispute over subsidies provided to the European aerospace group Airbus.
Industry bodies within the wine sector have consistently argued against penalizing producers and consumers in trade disputes involving other sectors. The European industry group CEEV recently released a manifesto addressing the future of the European wine sector, citing geopolitical tensions as a contributing factor to the uncertainty in global wine trade. The manifesto also noted a significant increase in EU wine exports, reaching €17.9bn globally in 2022-2023, compared to €3.9bn in 2004-2005.
