China hits Europe's brandy exports with duties but adds exemptions
A tariff rate on EU brandy could go up to 34.9% for five years from 5 July.
The duty was announced after China's Ministry of Commerce concluded an investigation into European brandy imports, determining that the products threatened its national brandy industry.
Cognac, which is heavily exported from France, was a product of concern, although major cognac makers like Pernod Ricard and Remy Cointreau will now be exempted.
China's investigation ruled that the EU had engaged in spirit 'dumping', a practice where foreign goods are sold significantly below their normal price. The corrective tariff will be charged in addition to a normal customs duty.
Belgium-based trade group spiritsEUROPE, representing EU producers of spirit drinks, said in a statement that it 'regrets today's decision by the Chinese Ministry of Commerce to impose final anti-dumping duties averaging 32.2% on EU wine-based spirits, marc-based spirits, and brandies as of 5 July,' adding that 'the measures will still pose a significant barrier to legitimate trade'.
The trade group also said that the EU spirits sector provided 'substantial evidence over the last 18 months, clearly demonstrating the absence of any dumping practices on the Chinese market'.
'The decision originates from a spat around unfair competition and protectionism and it is bad news for European drinks companies who enjoy big sales to Asia,' said Dan Coatsworth, investment analyst at AJ Bell. 'That explains why shares in Rémy Cointreau and Pernod Ricard were weak on the news as drinkers in China might think twice about buying their products if the price is now much higher.'
The news pulled down French spirits makers' share prices, with Pernod Ricard slumping 1%, Remy Cointreau down 1.75%, and luxury giant LVMH, the parent company of Hennessy and Rémy Martin, losing 2.1% around 11 CEST in Europe.
Related
China holds off on EU brandy tariffs as subsidy spat drags on
China's anti-trust tariffs over brandy come under fire
Closer to midday, share price losses moderated after news broke that China spared major cognac producers from the new duties, provided they sell at a minimum price.
Trade group spiritsEUROPE welcomed the partial relief, saying that 'to safeguard their operations and maintain a stable presence in the Chinese market, several affected companies have entered into price undertakings (raising export prices) with MOFCOM (China's Ministry of Commerce)', adding that these will replace anti-dumping duties for these companies.
The group urged Beijing to expand this option to all European companies affected.
SpiritsEUROPE Director General Hervé Dumesny said 'Beyond its direct impact on our sector, this decision risks fuelling trade tensions at a time when mutual cooperation is more important than ever.'
The decision on brandy comes after the EU decided to impose tariffs as high as 45% on Chinese-made electric vehicles last year.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
38 minutes ago
- Yahoo
1 top growth stock up 233% to consider buying in July
Wise (LSE: WISE) is a high-quality UK growth stock that listed in 2021. Unfortunately, its debut coincided with the end of the near-zero interest rate era — a shift that sent richly priced growth shares tumbling. Wise lost more than 60% of its value in 12 months! However, since bottoming out at 311p in July 2022, the stock has surged 233% higher. And it hit a record recently, as more investors turn bullish on the fintech disruptor. Could Wise stock head even higher over the next few years? I believe it can. Here's why. Wise specialises in international money transfers, believing that this should work without borders. In other words, money transfers should work the same internationally as easily as they do domestically. In reality though, there's still a lot of hassle when people and businesses move money across borders. SWIFT payments, for example, typically take a few working days to clear. Fees can be high and opaque. Wise's infrastructure and products aim to improve this clunky process with faster times and lower prices. Approximately 65% of transactions being done by Wise are now completed in under 20 seconds. In the 12 months to 31 March, underlying income jumped 16% to £1.4bn, driven by customer growth, account adoption, and higher interest rates. Active customers grew 21% to 15.6m, more than doubling since 2021. There are a number of things I find attractive about Wise. Firstly, it's going after a massive opportunity. Each year, individuals move around £3trn across borders, and Wise currently handles about 5% of that. Then there are small businesses, where cross-border transfers total roughly £14trn annually. Wise's share here is even smaller, but growing. Add in the enterprise and corporate segments, and the full opportunity balloons to around £32trn a year (yes, trillions!). Now, most of this is not directly within Wise's app ecosystem yet. But the company is building the infrastructure to theoretically move it all. It transferred around £145bn in its last financial year, but aims to one day move trillions and become 'the network for the worldʼs money'. To this end, the firm is linking more deeply into the payment systems of Brazil and Japan, while already handling around 12% of all global remittances to the Philippines. So its scale is only increasing. Another thing I like here is that Wise is run by co-founder Kristo Käärmann. In my experience, the best growth stocks are often run by founders that sacrifice short-term profitability for long-term market share (think Jeff Bezos at Amazon). In Wise's case, the company is obsessed with lowering fees for customers as it scales. It recently dropped its cross-border take rate to 0.53%, from 0.67% the year before. And Wise intends to lower it further in future. As Käärmann explains: 'This strategy of continuously lowering our fees makes it harder for anyone to compete, and it will underwrite the long-term success and growth.' In the near term, there are risks relating to a global economic downturn. That could dampen transaction volumes, meaning fewer people and businesses send money abroad. However, over the long term, I think this stock has all the ingredients to be a big winner. It's currently trading at a reasonable valuation, making it well worth considering. The post 1 top growth stock up 233% to consider buying in July appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Ben McPoland has no position in any of the shares mentioned. The Motley Fool UK has recommended Wise Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025
Yahoo
an hour ago
- Yahoo
How school run led CEO to 'coffee roulette' with staff and billion pound vision
Lyndon Stickley tries to 'scare a lot of people away' when he oversees first interviews for roles at cloud-accounting start-up iplicit. Yet Stickley, who bills himself as a go-to-market evangelist after successfully scaling and selling six previous companies, is far from your ruthless CEO. For the zest in which he describes his involvement with iplicit and why he won't be exiting a business for a seventh time – one of his previous projects includes London's largest graveyard – makes him a particularly charismatic leader. Hampshire-based Stickley is aiming to take the remote-first firm — he takes part in daily 'coffee roulette' mornings with employees — to unicorn status by 2030, by making it the "on-premises salvation" for mid-market businesses and their 'outdated' finance systems. Read More: Meet Britain's 'king of billboards' who sold his business for £1bn Launched in 2019, iplicit gained a top 20 place among UK firms in the FT1000 list of Europe's fastest growing businesses. Last year, the firm was one of the Sunday Times' medium business top places to work. So, to those job interviews. 'I say it might not be for you and tell them that this a place for really passionate, slightly unhinged mountain climbers,' says Stickley, who built and sold his first company, an ISDN tech firm, for £40m before turning 30. 'If you say we are off on a mountain climb which will take three months and you might lose a finger to frostbite but we will stick a flag at the top, we are looking at the one person who will lean in where the other 19 won't.' The fact he is even discussing iplicit's marketplace rise is, he says, down to luck. 'Happenstance has been the foundation of everything,' he adds. Stickley tells the story of how Ian Andrews, an engineer by heart, spent 20 years running a company called Concept Software and becoming one of the UK's leading implementation consultancies for the likes of Oracle. He had been introduced by a friend on the school run who said he should look at Andrews' accounting software business. Shortly afterwards, Andrews spent two hours explaining to Stickley about large scale enterprise resource planning (ERP) – an area in which the serial entrepreneur had no experience. Once vendors had concluded software deals, Andrews would place people on site for up to two years and charge hundreds of thousands of pounds for implementation work. 'It was a world that blew my mind,' says Stickley. 'After 20 years, he told me, he realised he was part of the machine that was stacked against the customer, who was also getting mugged rather than it being implemented out of the box,' Stickley recalls of their first meeting. Read More: The boss who has found 'nature's answer to plastic' 'He said to me that he decided to build a better system by investing £1.5m of family savings and a friend who did the same. They carved off some engineers and created an accounting solution [iplicit] which could be deployed in days and compile reports in hours not weeks, with low disruption.' Stickley asked how many customers iplicit had, to which Andrews replied none. It was, however, the start of an unlikely relationship, given that Stickley would usually have refrained from any reckless decisions in previous investments. Having promised his friend, Stickley made some calls and was told to give it a wide berth. One final network call to a co-founder of legacy finance firm Exchequer, who he knew over 20 years previously, changed the direction. After looking at the software, he was left enthused by its power and low touch. With Stickley investing £1m into Andrews' business, iplicit swelled to around 20 staff, went to market in 2019 and immediately started winning top accountancy awards they hadn't entered. Iplicit's plan had been how to overcome the issue of customers buying finance software off an unknown player in the market. COVID not only levelled the playing field, with video meetings and iplicit's shorter implementation times, but also propelled the appeal from mounting customers who had non-cloud system issues. Iplicit realised that it could serve 100,000 sites, often multi-company locations, with a 25% market share goal and a £500m a year business. 'We couldn't have possibly contrived that [accounting software giant] Sage would drop a royal ball and not have something for the vast majority of its base,' says Stickley. The industry had also taken notice. Stickley was told by Oystein Moan – the executive chairman of Visma who took the company to unicorn status – that iplicit was a multi-million pound opportunity in the UK alone. Last year, Moan and Nic Humphries, one of the biggest private equity players in the business-to-business software space, joined iplicit's advisory board. Read More: 'Why we set up a sustainable mobile operator to save people money' Stickley's entrepreneurial spirit had been gained from his father, who had a chicken farm at 16, ran a nightclub in his twenties and worked with artists like Lulu and the Rolling Stones. Aged 17, Stickley junior took Wednesdays off sixth form college to sell kitchenware at the local market, earning £200. At university, he ran five club nights across Portsmouth in the late 1980s before his penchant for scaling businesses. 'The worst and the best I have been involved in is the most human connected and impactful business,' Stickley says of Kemnal Park, which he describes as the UK's first cemetery to celebrate life and built for people to return. 'The 'thank yous' were non stop,' he says, 'when you can see week in, week out people come back and be inspired by the place where they have buried a loved one.' Stickley met Andrews as the former was leaving the cemetery business, with iplicit planning for two years before launch. From 2006 to 2022, Stickley worked part-time three days a week. He took the helm as CEO when he realised that the business wouldn't be sold and is now working as if 'back in my twenties'. The firm has one office in Poole, Dorset with 25 employees, and around 135 working remotely. Stickley says iplicit's growth has been down to lifting the barriers of geography and has U-turned on seeing recruitment agencies as 'the enemy'. 'Getting a good recruitment pipeline means you have talent on tap when you need it,' Stickley adds. 'There's no way you can grow fast like this and do the recruitment function as you can't afford mediocrity to creep into the camp.' Iplicit's goal, he says, is to become the de facto standard in the UK before any entrance into the US. It currently serves over 43,000 daily users in over 3,000 organisations. 'We have the best tech, team and trajectory and an advantage that no one else has in the market right now,' he adds. All thanks to that school run chat and Andrews being a few months shy of running out of money before meeting iplicit's future CEO. 'What doesn't make him bonkers is he didn't go bust, so now he's a genius, right? Because he really was," says Stickley. "But if it had gone bust, he was bonkers. It was a fine line.' Coffee roulette and remote-first You value the relationships more when you don't have them on a plate every day. We get together six times a year and we all hug across 150 people as we aren't in the office getting bored with each other. The video efficiency is unbelievable. I can have 15 meetings in a day and include coffee roulette in that, which was invented by one of our techies where a random name generator pairs two people to have 20 minutes together. I found it so insightful I now have around 25 coffee roulettes a month virtually across the country. It takes the drudge out of the work and makes meetings more concise. We don't recruit younger people typically; they deserve a right of passage in an office. We are heavily biased towards over 35s as we suit the young families and older, experienced employees and appeal to an audience who don't want to commute. We measure trust by measuring outputs, not by checking in on people. Read more: The life lesson behind a 335-year-old funeral business? 'Never sleep on an argument' Meet the company that finds 'must-haves' to make everyday life easier Impossibrew CEO says Dragons' Den failure sparked alcohol-free brand's rise
Yahoo
an hour ago
- Yahoo
Europe Is Playing Catch-Up in the Race for Critical Minerals
A once-niche corner of the commodities market has become a new frontier in global power politics. To make everything from electric vehicles and wind turbines to next-generation weapons systems, modern economies now depend on a growing roster of buried ingredients: cobalt, lithium, rare earths and other so-called critical minerals. Governments are responding in kind. In April, the U.S. signed a landmark deal with Ukraine, granting U.S. firms access to the country's mineral reserves in exchange for defense and reconstruction support. It was a transactional agreement and a revealing one: A war-forged security partnership now hinges on minerals as bargaining chips, in a world where raw materials increasingly double as strategic currency. Elsewhere, Gulf states are making inroads across Africa, while China—already the commanding force in global mineral supply chains—continues to tighten its grip. Now the European Union is sprinting to catch up. Over the past two years, Brussels has signed a flurry of raw materials partnerships, including with Zambia, the Democratic Republic of Congo and Namibia. Robert Besseling, CEO and founder of Pangea-Risk, notes that the EU 'has its own definition of what makes some minerals critical, and that's different from how China, the U.S. and smaller players like Russia see what is critical for their domestic economies.' As a major steel producer, for instance, the EU's list of critical minerals includes coking coal, along with materials like silicon, helium, boron and gallium, which aren't priorities for most other powers. To get more in-depth news and expert analysis on global affairs from WPR, sign up for our free Daily Review newsletter. But where demand for minerals overlap, the competition is fierce. And whether it's aluminum and bauxite in Guinea, graphite in Mozambique, lithium in Zimbabwe, nickel in South Africa, and copper and cobalt in the DRC and Zambia, Besseling says, the central arena of that competition is in Africa. Meanwhile, in the name of 'de-risking,' the EU also wants to wean itself off foreign dependence by building what it calls more resilient supply chains, which is shorthand for reducing reliance on a single supplier, more local or allied-country processing and greater control over each stage of production. That won't be easy, however. Take lithium and rare earths, for instance: The EU imports nearly all of its supplies of both—and in the case of rare earths, half come directly from China, which controls 90 percent of global processing. 'China is way ahead in terms of investment, but also in terms of actual ownership and operations of mines,' says Besseling. That reach, he adds, spans the entire production process. When it comes to electric vehicles, or EVs, for example, Chinese companies dominate the supply chain for the minerals that go into their batteries on the mining side. But they also dominate 'the processing side and the manufacturing of EVs,' he adds. 'The whole value chain is essentially dominated by China.' It wasn't always this lopsided. During the 2003-2011 commodity supercycle, when metal prices surged, Western mining giants such as BHP, Rio Tinto and Glencore aggressively expanded into Africa and Latin America, pouring billions into what are known as frontier projects in the sector due to their greater risk. But as copper and cobalt prices fell, the calculus for risky overseas ventures shifted. Investors demanded caution, and companies began retreating. At the same time, the wealthy member countries of the Organization for Economic Cooperation and Development doubled down on the so-called Gentlemen's Agreement, a long-standing pact discouraging the use of subsidies to boost national champions. The idea was to hedge against a race to the bottom in state-backed financing, meaning no cheap loans to help mining firms compete abroad. The problem is that Chinese lenders have opted for a different approach that isn't based on the West's liberal market-based model, says Brooke Escobar, who directs a team at AidData specializing in financial tracking. In a report released in January, Escobar and her co-authors detailed how, over the past two decades, China has built a financing model that's fast, scalable and tough for Western countries to match. A Chinese state-owned enterprise might enter a country to co-develop a copper or cobalt mine, for instance, backed by a loan from one of Beijing's policy banks or state-owned commercial lenders. 'But it's concessional lending,' Escobar points out, 'so it's cheaper than what those companies could get on the market otherwise.' Moreover, that financing often covers the costs of developing not just the mine itself, but also roads, power plants and export terminals. And it usually comes in stages, with several loans supporting the project through development and operation. Meanwhile, in addition to securing equity in the mine, the Chinese firm signs a long-term offtake agreement—a contract to buy a set share of the mine's output—typically with a buyer in mainland China. This combination of ownership abroad and guaranteed supply for domestic processors is central to China's strategy. And it has paid off. Between 2000 and 2021, China committed nearly $57 billion in state-backed financing for these mineral projects across 19 low- and middle-income countries, according to AidData's report. As a result, it now holds sway over every stage of the supply chain for many of the critical minerals that will fuel the green energy transition. Chinese companies control 25 percent of global lithium mining capacity and 80 percent of cobalt production in the DRC, which supplies over half the world's cobalt. China also handles around 90 percent of global rare earths processing, over two-thirds of cobalt and lithium refining, and more than half of the global material exports that go into batteries. In short, China has developed a playbook that sidesteps market hesitations, tolerates political risk and prioritizes long-term strategic gains. And the West has struggled to adapt. 'It's not necessarily that the Chinese companies have this exclusive edge,' says Tiffany Wognaih, an Africa-focused political risk and strategy adviser at the J.S. Held global consulting firm. 'Rather, they have been the players that have shown a willingness to enter the market.' They've also shown greater staying power compared to Western companies that did enter frontier markets. Wognaih points to the U.S. mining giant Freeport-McMoRan, which began investing heavily in the mid-2000s in two major copper and cobalt sites in Congo: the Tenke Fungurume mine and the Kisanfu exploration project. But in 2016, under financial strain, 'they put the asset up for sale,' Wognaih says. 'And China took it.' Escobar also cites Freeport-McMoRan's exit from Congo, but as a case of Western governments failing to act. Both U.S. officials and representatives of the company appealed for help from Washington to retain control of the project. 'But no one stepped in,' she says, in part due to a lack of political will. But she adds that, having built their finance systems around strict rules on market neutrality, OECD countries 'don't have the mechanism to say, 'We're going to extend you this cheap finance that will provide you the liquidity that you need to make it through.'' Without that state backing, Western financiers are left to rely on risk-reward calculations, and that limits the options. 'Tier-one projects will get financed,' Andor Lips, a financing and raw materials expert at the Dutch Geological Survey, says, referring to quality projects that are ready to come to market. But there are only a handful of them, and lower-tier projects are riskier, starting with the risk of exploring a concession and not finding exploitable reserves. 'There are also market risks, price, environment, delays,' he adds. 'It's all in the mix.' That's bad news for the EU. For now, the mineral partnerships it has signed are largely symbolic: nonbinding and dependent on private investment. But as Lips—who has contributed to work by the European Commission as an external expert—notes, 'the EU is not a country, so the legal push to encourage investments is limited: You cannot provide tax incentives, you cannot provide additional capital, where normally a country can do that.' There are EU financial tools at private firms' disposal, including the European Investment Bank, the European Bank for Reconstruction and Development, and initiatives like the Global Gateway. But navigating them is complex. Figuring out which funds can be used where, and how overlapping mandates interact, is 'a bit of an intellectual exercise,' Lips says, adding that even functionaries within the European Commission are often operating based on fragmented information. Worse, the EU is up against the clock, as the race for critical minerals is getting more crowded. Gulf countries are deploying cash and state backing to strike minerals deals across Africa, with Turkey, India and others following suit. Many are copying China's playbook: bundled deals, state-backed financing and minimal red tape. The U.S., under President Donald Trump, has loosened enforcement of anti-corruption rules to give companies more leeway in risky environments and is partnering with Gulf allies to share investment risk. The EU, by contrast, remains bound by high environmental, social and governance, or ESG, standards, as well as a fractured bureaucracy and few tools to compete. Indeed, Europe's lag is partly structural: Market-first models simply aren't built to compete with the speed and coordination of state-led rivals like China. But it's difficult to reflect on the past few decades without also recognizing a stunning lapse in political foresight. As China doubled down on access to critical minerals, Western countries pulled back, even as it was already clear these minerals would come to hold tremendous geopolitical weight. Now, catching up may mean setting aside market orthodoxy in favor of security priorities. The urgency is real: After Beijing imposed new export controls on rare earths this spring, automakers in Europe and the U.S. warned they were just weeks away from halting production lines. But even if Europe secures more raw materials, full independence from China remains out of reach. 'If you get access to processed minerals you still need to create demand for those processed minerals in the EU,' says Poorva Karkare, senior policy analyst at the European Centre for Development Policy Management. 'In order to do that, you need to start producing more batteries, more EVs, more whatever.' And given its dominance across the supply chains for these products, that will mean working with China. Rather than framing the challenge as a zero-sum game, Karkare suggests the EU should bring China into its partnership model. European firms may currently play a small role in extraction, but they excel in surveying and engineering. Even their ESG standards could work to their advantage, as Chinese firms are already turning to European counterparts to meet rising standards demanded by investors, global regulators, African governments and consumers, she notes. If European firms embed themselves deeper into project lifecycles, they could claim more of the value chain and start to build mutual dependence with their Chinese partners. Karkare concedes that EU leaders might balk at a strategy that involves China. 'But China is going to be involved every step of the way, and there's almost no circumventing that,' she says. The conversation in Brussels and Washington these days has shifted to completely decoupling from China. But as Karkare notes, when it comes to critical minerals, that's no longer feasible. Instead, Europe should try to think of ways to reduce that dependence, including by making it mutual. Carl-Johan Karlsson is a freelance journalist covering politics in the U.S. and Europe. You can find him on LinkedIn. The post Europe Is Playing Catch-Up in the Race for Critical Minerals appeared first on World Politics Review.
