The Ongoing Cognac Brawl: France vs. China
Conflict Over Cognac Remains Unresolved: France and China at Odds - Ongoing Impasse in the French-Chinese Cognac Trade Controversy Remains Unresolved
The ongoing spat between France and China over Cognac tariffs shows no sign of letting up. Recent negotiations between French Finance Minister, Eric Lombard, and Chinese Vice Premier, He Lifeng, failed to yield a concrete resolution, but both parties are open to further discussions[1][3][4]. The Chinese government has been implementing provisional dumping measures on EU-produced brandy since October 2023, requiring importers to foot a security deposit upon arrival[1][3].
The Tariff Bull's-Eye
China has threatened to slap a 34% tariff on French spirits, including Cognac, starting July 5, 2025, as part of its retaliatory measures against EU tariffs on Chinese electric vehicles[2][4]. This heavy-handed action is viewed as a significant escalation of the trade war between the two nations.
Will There Be a Truce?
Although a quick fix is yet to materialize, both France and China are congenial about pursuing future dialogue to dodge the July 5 tariff, which could bring "apocalyptic consequences" for the Cognac industry[3][4]. The continued dialogue implies that a diplomatic solution is still within reach.
The Bank Guarantee Tangle
The security deposit demanded for brandy imports forms part of the provisional measures enforced by China. This requirement places additional financial burdens on importers, and if not resolved, could exacerbate the industry's woes[1]. A clear roadmap for handling these guarantees remains elusive in future negotiations.
Final Thoughts
As the Cognac dispute between France and China persists, both sides continue conversations. The imposition of tariffs and security deposits continues to be a major stumbling block. Averting the July 5 tariff deadline is crucial for the industry's longevity, but the immediate fate of Cognac exports to China remains clouded in uncertainty.
- The European Union, particularly the European Parliament, is closely monitoring the ongoing Cognac tariff issue between France and China, as the dispute holds significant implications for the European industry, politics, and general news.
- Despite the ongoing stalemate, the finance ministry in France, Germany, Italy, Spain, Belgium, Poland, and other European nations have been engaging in discussions with their Chinese counterparts to address the financial burdens imposed by the security deposits and potentially avert the scheduled tariff increase on European brandy in the business sector.
- As the polarizing trade dispute between France and China continues, the European Commission and the Council have been advocating for a diplomatic resolution that takes into consideration the long-term implications on the Cognac industry, politics, and EU-China relations, emphasizing the need for a fair and equitable solution.
