President Trump escalated his commerce warfare with the European Union on Thursday, threatening 200 p.c tariffs on European wine and champagne that deepened nervousness amongst companies and shoppers on either side of the Atlantic.
Mr. Trump’s announcement, wherein he referred to as the E.U. “hostile and abusive,” got here a day after the bloc’s leaders unveiled plans to retaliate towards a batch of U.S. tariffs that took impact this week by imposing 50 p.c tariffs on imports of U.S. whiskey and several other different American merchandise.
“If this tariff will not be eliminated instantly, the U.S. will shortly place a 200 p.c tariff on all wines, Champagnes, and alcoholic merchandise popping out of France and different E.U. represented international locations,” Mr. Trump wrote on social media on Thursday.
The E.U.’s tariff plan got here in response to a set of U.S. tariffs on metal, aluminum, and different associated merchandise that took maintain on Wednesday.
The 27-nation bloc defined that it could react to America’s metal and aluminum tariffs in two waves: First, with tariffs as excessive as 50 p.c on U.S. merchandise together with Harley-Davidson bikes and Kentucky bourbon, which can take impact on April 1; and second, a sequence of measures in mid-April that will goal farm merchandise and industrial items which can be necessary to Republican districts.
European leaders have made it clear that they would favor to not enact these measures, and wish to come to an settlement with Mr. Trump as a substitute.
“Tariffs are taxes,” Ursula von der Leyen, the president of the European Fee, the bloc’s government arm, mentioned in a assertion on Wednesday. However with little progress towards a deal, E.U. leaders had determined to hit again in politically delicate product classes, hoping to inflict sufficient ache to drive People to the negotiation desk.
European officers had anticipated that Washington may react, and a few vowed on Thursday to not cave underneath that stress.
“We won’t give in to threats,” Laurent Saint-Martin, France’s overseas commerce minister, mentioned in a publish on X. Mr. Trump “is escalating the commerce warfare he selected to unleash,” he added.
The European Fee, which most straight drives commerce coverage for the economies within the bloc, didn’t have a direct touch upon Mr. Trump’s publish.
However Olof Gill, a spokesman for the fee, mentioned that the commerce commissioner Maros Sefcovic had reached out to his American counterparts after the E.U.’s bulletins on Wednesday. Calls had been “being ready,” he mentioned.
This isn’t the primary time the spirits and alcohol business has been caught in a trans-Atlantic commerce warfare. Much less excessive tariffs had been positioned on liquor and different alcohol throughout Mr. Trump’s first time period, and the business’s restoration from that hit has been lengthy and grueling.
Again then, the president threatened champagne with tariffs, however didn’t observe by way of.
Whereas it’s not clear how a lot it mattered in that case, Bernard Arnault, France’s richest man and head of the LVMH Moët Hennessy Louis Vuitton luxurious empire, is a longtime good friend of Mr. Trump’s. He attended the president’s current inauguration.
Mr. Arnault’s firm is residence to manufacturers together with Dom Pérignon, Krug and Veuve Cliquot.
This time round, a variety of alcohol business executives have been lobbying in Washington, Brussels and different European capitals to be spared — and have expressed alarm that they’re as soon as once more caught within the crossfire.
Ulrich Adam, director basic of the commerce group spiritsEurope, referred to as Mr. Trump’s tariff menace on European alcohol a “shocker.” The group goals “to get spirits out of the center of those unrelated disputes,” he added.
There appears to be little hope of a direct reprieve. Mr. Trump pressured that the tariffs “can be nice for the wine and Champagne companies within the U.S.”
Champagne, technically, is produced solely in a particular area in France. About 16 p.c of its complete exports go to america, based mostly on business information from 2023, making America the biggest importer of the glowing wine.
That is the second time this week that Mr. Trump has threatened to quickly escalate a commerce warfare towards an in depth ally.
On Tuesday, Mr. Trump threatened to double the tariffs on Canadian metal and aluminum after the province of Ontario responded to his earlier tariffs by placing a surcharge on electrical energy it exported to america.
Inside hours, Ontario had suspended its surcharge, and Mr. Trump additionally walked again his threats. On Wednesday, he proceeded to tax Canadian metal and aluminum on the identical 25 p.c charge as different international locations.
Governments have assorted their responses to Mr. Trump’s tariff threats.
China, the European Union and Canada have rapidly answered Mr. Trump’s tariffs with levies of their very own, inspired by their home political constituencies to combat again or emboldened by leverage based mostly on the dimensions of their economies.
However governments in Australia, Brazil, Britain, Japan and Mexico have chosen to not retaliate, no less than for now, as they search a take care of Mr. Trump.
Liz Alderman contributed reporting from Paris.
