China To Require EU Brandy Exporters To Raise Prices Or Face Tariffs
Almost all EU brandy is cognac produced in France, exports of which to China are worth 1.4 billion euros ($1.6 billion) per year.
Beijing launched an investigation last year into EU brandy, months after the bloc undertook a probe into Chinese electric vehicle (EV) subsidies.
It said it had determined in a preliminary ruling that dumping had occurred and imposed "temporary anti-dumping measures" on imports of the alcoholic beverage -- moves now costing the industry 50 million euros per month.
Beijing's commerce ministry said on Friday that China's tariff commission had "decided to impose anti-dumping duties on imports of relevant brandy originating in the EU" from Saturday.
But Beijing said in an explanatory note that several major French cognac producers had signed onto a price commitment to avoid the tariffs -- as long as they sell at or above an agreed minimum price.
French liquor giant Jas Hennessy would be hit with levies of 34.9 percent if it reneges on the deal, it said.
Remy Martin will be hit with 34.3 percent and Martell 27.7 percent.
"The decision to accept the price commitment once again demonstrates China's sincerity in resolving trade frictions through dialogue and consultation," a commerce ministry spokesperson said in a statement.
China has sought to improve relations with the European Union as a counterweight to superpower rival the United States.
But deep frictions remain over economics -- including a yawning trade deficit of $357.1 billion between China and the EU, as well as Beijing's close ties with Russia despite Moscow's war in Ukraine.
The new levy threats come as Chinese top diplomat Wang Yi has held fraught meetings with his counterparts during a tour of Europe this week.
They will likely be high on the agenda when he meets French President Emmanuel Macron and Foreign Minister Jean-Noel Barrot on Friday afternoon in Paris.
A trade row between Beijing and the bloc erupted last summer when the EU moved towards imposing hefty tariffs on electric vehicles imported from China, arguing that Beijing's subsidies were unfairly undercutting European competitors.
Beijing denied that claim and announced what were widely seen as retaliatory probes into imported European pork, brandy and dairy products.
The bloc imposed extra import taxes of up to 35 percent on Chinese EV imports in October.
Beijing later lodged a complaint with the World Trade Organization, which said in April that it would set up an expert panel to assess the EU's decision.
China and the EU are scheduled to hold a summit this month to mark the 50th anniversary of the establishment of diplomatic ties.
Bloomberg News reported on Friday, citing unnamed sources, that Beijing intends to cancel the second day of the summit.
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DW
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'One event' arms pause troubling for Ukraine – DW – 07/04/2025
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DW
an hour ago
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Can BRICS project unity amid global tensions? – DW – 07/04/2025
The influence of BRICS, a global forum championed by China, Russia, and India, is on the rise. Still, even its major members have to negotiate internal conflicts amid challenges posed by the Trump administration. A two-day summit of the BRICS grouping of emerging economies starts Sunday in Brazil's Rio de Janeiro, as the global forum seeks to build consensus and cohesion after the group expanded over the past two years. BRICS styles itself as a counterweight to western multilateral institutions like the G7, and describes its role as a "political and diplomatic coordination forum" for countries of the Global South. Brazil, which holds the grouping's rotating presidency, is focusing the Rio summit on strengthening Global South cooperation for more inclusive governance. 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To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Other ideas like a common BRICS currency to counter the US dollar have fallen flat, partly due to China's economic dominance, which would give it an outsized weight over other members. Moreover, internal disagreement persists over issues like Russia's war in Ukraine. A key narrative used to promote BRICS was based on an appeal to legitimizing principles, like the idea of national sovereignty, and non-intervention of countries in another's domestic affairs. "The problem is that you have Russia there, which is now challenging the sovereignty of other countries. You have China there, which is challenging the sovereignty of India and of several other countries in the maritime space," said ORF's Pant. Geopolitical tensions between China and India include a border dispute and China's support for Pakistan during the recent skirmish between Islamabad and New Delhi. There are "divergences between India and China that are quite significant,"Pant said. "China remains uncomfortable with wider issues about India's rise and role in the global hierarchy," according to the Indian expert. BRICS has also notably failed to muster a common response on the string of geopolitical and economic challenges coming from the US, including Donald Trump's threat of tariffs. When Iran, a member of BRICS, was bombed by the US, BRICS members issued a strongly worded joint statement expressing "serious concern" over attacks against "peaceful nuclear installations." But fellow BRICS members Russia and China, which both have partnership agreements with Iran, did not take any substantive action on Tehran's behalf. On Trump's blanket tariffs, BRICS was absent as a cohesive front for negotiation, despite its massive GDP size on paper. "By and large we've seen a very pragmatic approach by all of these countries in engaging with the Trump administration rather than putting up a fight on some grand principles," Pant said. "If you look at the rhetoric and you look at the actual realities on the ground, both the Russians and Chinese at this point are more interested in cutting bilateral deals with Trump. Russians are working with Trump on security architecture in Europe, China is working on a trade deal. Indians are also interested in a bilateral trade deal with the US." To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video "On substance, there is not much there as an example of countries that have the potential to push back against the US, because all of them are cutting bilateral deals," he added.
DW
3 hours ago
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EU and Germany push for a new World Trade Organization – DW – 07/04/2025
Brussels and Berlin have launched a new initiative aimed at bypassing the long-standing paralysis of the World Trade Organization (WTO) caused by the United States. But how viable is such a solution? A proposal, introduced by European Commission President Ursula von der Leyen and German Chancellor Friedrich Merz, has sparked considerable attention. Speaking at the end of a summit of EU leaders in Brussels on June 27, they floated the idea of the EU taking the lead in forming an alternative to the World Trade Organization (WTO), the world trade body that has been in place since 1995. Merz said the idea was in its early stages but could include mechanisms to resolve disputes, as the WTO was meant to do. "You all know that the WTO doesn't work anymore," he said, adding that a "new kind of trade organization" could gradually replace "what we no longer have with the WTO." The German chancellor was referring to the near-total breakdown of the WTO's dispute resolution mechanism. It was former US President Barack Obama who first blocked appointments to the WTO's Appellate Body — its top court for trade disputes — during his later years in office. That blockade has continued under every US administration since, regardless of party affiliation, as successive governments have opposed WTO rulings that they argue undermine US national interests. As a result, trade disputes can no longer be conclusively resolved once a party appeals. Currently, unresolved cases include disputes between the EU and Indonesia over nickel ore exports, rulings on subsidies for aircraft manufacturers Boeing and Airbus, and anti-dumping cases against China. The EU's von der Leyen emphasized plans for a particularly close partnership with like-minded trade nations in Asia, referencing potential cooperation with the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). This trade alliance currently includes Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, and Vietnam. The United Kingdom has also joined, becoming the first European country in the bloc. But can Europe realistically create a new WTO without US involvement? And how effective would an alliance with like-minded global partners be, especially in the Asia-Pacific? Jürgen Matthes, an international trade policy expert at the Cologne, Germany-based German Economic Institute (IW), expressed support for the initiative in an interview with DW. "A formal EU application to join the CPTPP would be a strategically important move in several respects," Matthes said. "It would send a clear signal to the US that its protectionism is isolating it, while the rest of the world continues to liberalize trade." Matthes also said this would create a "remarkably large trans-regional trade agreement," involving major economies, "with the EU as the largest bloc." "It would cover nearly all continents. And maybe some African countries could be brought on board as well," he added. Such a club, however, would initially exclude China, which Matthes argued is not known for playing by fair competition rules. "The goal is to form a strategic trade alliance that addresses today's pressing issues in global trade — not only US protectionism, but also the massive market distortions caused by China's subsidies, which current WTO rules don't effectively address," said Matthes. To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video For the EU, the priority would be to enshrine strict competition rules within the new framework, particularly regarding state-owned enterprises and industrial subsidies. "Anyone who meets those standards can join," he added. That would require China to make major reforms, such as reducing market distortions and subsidies, or finally agreeing to a comprehensive overhaul of WTO rules. Free trade advocates have already created a workaround to the WTO's stalled appeals process called the Multi-Party Interim Appeal Arbitration Arrangement (MPIA). Formed within the WTO itself, MPIA provides an alternative dispute resolution system that functions without US participation. According to the European Commission, 57 countries, representing 57.6% of global trade, have joined the MPIA, including the UK and all EU member states. Still, business groups such as the Federation of German Wholesale, Foreign Trade and Services (BGA), which represents Germany's export sector, are wary of undermining the WTO. Speaking to news agency Reuters, BGA President Dirk Jandura acknowledged the strategic benefits of forming a new framework among functioning democracies via CPTPP, but warned of the risks. "We must not allow global trade to splinter into competing blocs with different rules," he said. "This new organization must only be a transitional solution, clearly aimed at reforming — not replacing — the WTO." Brussels has also been careful to clarify that the goal is not to render the WTO obsolete. EU Commission President von der Leyen described the "structured cooperation" with CPTPP members as a potential starting point for reshaping the WTO. Even the WTO's former chief economist, Ralph Ossa, who recently returned to the University of Zurich, openly acknowledged the need for change. "Does the WTO need reform? Absolutely," he told DW. Germany's economy ministry echoed that view, with a spokesperson for Minister Katharina Reiche confirming that the German government, together with the European Commission, is actively pushing for WTO reforms. These include new rules to curb industrial subsidies to ensure fair competition, digital trade initiatives, and investment facilitation. The EU is already in talks with countries that support open and rules-based trade — including CPTPP members. The EU's dual message to both the US and China appears to be part of a deliberate communication strategy that has evolved since US President Donald Trump's tariff war. Matthes envisions a new alliance under the banner of "Open Markets with Fair Trade." In such a setup, "the US is out when it comes to open markets, and China is out when it comes to fair trade — unless things change under a new US administration or a reformed China emerges." He sees multiple advantages to this strategy. "We'd achieve more trade liberalization and gain access to new markets. We'd isolate the US more and show Trump that protectionism is ultimately a dead end." At the same time, Europe could send a clear message to China that it will no longer tolerate market distortions, he added.
