Trump hints at action over ‘unfair’ French wine imports

President Trump has hinted he will “do something” about the “unfair” tariff imbalance on French wines in the US in a call with US TV network CNBC this week.

The controversial – and teetotal – US president was talking to anchor Joe Kernen on the station’s flagship news and markets program Squawk Box on Monday about his imposition of tariffs on China, when he raised the “unfair” issue of tariffs on wine.

“France charges us a lot for the wine and yet we charge them little for French wine,” he said, promising to “do something” about it.

He further said the wineries themselves had approached him to complain about having to pay to import their wines into France.

“The wineries come to me and they say – the California guys, they come to me: Sir, we are paying a lot of money to put our products into France and you’re letting – meaning, this country is allowing this French wine which is great, we have great wine, too, allowing it to come in for nothing.”

“It is not fair. And you know what, it’s not fair. We’ll do something about it.”

Trump has previously complained on Twitter about how difficult it was to sell US wines in France, blaming high tariffs, while the US “makes it easy for French wines”.

In November last year he said this was “Not fair, must change!’”.

As a member of the EU, France does not set its own tariff, but is subject to those set by the EU as a trading block.

According to US wine trade body, the Wine Institute, US wines entering the EU face duties of between 11 cents – 29 cents a bottle depending on the alcohol contents, while the US International Trade Commission show EU wine coming into the US incurring a duty of 5.3 cents to 12.7 cents a bottle for still wine, with sparkling wines taxed at the higher rate of around 14.9 cents a bottle.

However as US wine journalist Christy Canterbury MW pointed out in a blog on the topic following the President’s twitter outburst last November, the issue is more complex than simply blaming “unfair” ‘French’ tariffs. She pointed out that much of the wine historically exported from the US to Europe had been at the lower value end but that premiumisation was helping US wines stand up to the competition, as tariffs made less of an impact. She also pointed out that around 25% of the US exports to Europe are shipped in bulk, with European producers paying double the US bulk wine tariff.

Trump’s comments comes as tensions between the US and EU ratchet up over trade, notably in response to the EU subsiding aerospace and defence group Airbus, which was deemed illegal by the WTO last year.

The US government has recently identified $21 billion-worth of EU good imports – including wine – which it said could be subject to tariffs. However the US members of international grower organisation Wine Origins Alliance wrote to the US trade representatives, calling for the scrapping of proposed tariffs on EU wine, and urging the US trade representatives to work with his European Commission counterpart to reduce or eliminate wine tariffs, rather than to raise them.

The move was echoed by members of the EU members of the organisation.

“Promoting wine exports by removing trade barriers is critical to driving industry growth and creating new industry jobs,” the signatories from the Wine Origins Alliance said.

The US President has recently returned from a visit to Europe where he met President Macron in Normandy as part of the 75th commemorations of the D-Day landings, however it is not known if the issue of tariffs over wine was raised.

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