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EU pushes for wine exemption to US tariffs
//food-wine.news-articles.net/content/2025/07/31/eu-pushes-for-wine-exemption-to-us-tariffs.html
Published in Food and Wine on Thursday, July 31st 2025 at 12:02 GMT by Le Monde.fr🞛 This publication is a summary or evaluation of another publication 🞛 This publication contains editorial commentary or bias from the source
After the EU and US announced a trade deal on July 27, in which most EU products imported to the US would be subject to a 15% tariff, France, Italy and others have pushed for an exemption for European alcohol and wines.
EU Intensifies Efforts to Secure Wine Exemption from Looming US Tariffs
In a bid to safeguard one of Europe's most iconic industries, the European Union is ramping up diplomatic pressure on the United States to exempt wine from a new round of proposed tariffs. This push comes amid escalating trade tensions that threaten to disrupt transatlantic commerce, particularly in the agricultural and luxury goods sectors. As negotiations heat up, EU officials are highlighting the cultural and economic significance of the wine trade, arguing that punitive measures would disproportionately harm small producers while yielding minimal benefits for US interests.
The controversy stems from ongoing disputes over subsidies and trade practices, reminiscent of past conflicts like the long-standing Boeing-Airbus rivalry. According to sources close to the talks, the US administration is considering tariffs on a wide array of European imports as retaliation for perceived unfair advantages in various industries. Wine, a staple export from countries like France, Italy, Spain, and Germany, has emerged as a flashpoint. The proposed duties could reach up to 25% on certain categories, potentially adding hundreds of millions of euros in costs to European exporters and driving up prices for American consumers.
EU Trade Commissioner Helena Voss has been at the forefront of this campaign, emphasizing the need for targeted exemptions. In a recent statement from Brussels, Voss declared, "Wine is not just a commodity; it's a symbol of European heritage and craftsmanship. Imposing tariffs on it would be akin to punishing artists for the actions of corporations. We urge our American partners to recognize the mutual benefits of free trade in this sector." Her comments underscore a broader EU strategy to decouple cultural products from industrial disputes, drawing parallels to previous exemptions granted for items like Scotch whisky in earlier trade spats.
The economic stakes are immense. Europe exports approximately €5 billion worth of wine to the US annually, making it the largest market outside the continent. France alone accounts for over half of these exports, with renowned regions such as Bordeaux, Burgundy, and Champagne facing the brunt of potential fallout. Industry analysts predict that tariffs could lead to a 15-20% drop in sales, forcing producers to either absorb costs or pass them on, which might erode market share to competitors from Australia, Chile, or even domestic US wineries in California and Oregon.
Small and medium-sized vineyards, which form the backbone of Europe's wine industry, are particularly vulnerable. In Italy's Tuscany region, for instance, family-run estates that have operated for generations fear bankruptcy if tariffs take hold. "We've weathered droughts, pests, and pandemics, but this could be the final blow," said Marco Rossi, a vintner from Chianti, in an interview with European media. Similar sentiments echo across Spain's Rioja and Portugal's Douro Valley, where exporters rely heavily on the US for premium sales.
The EU's lobbying efforts have included high-level meetings in Washington and virtual summits with US trade representatives. A delegation led by French Agriculture Minister Pierre Laurent recently visited key congressional offices, armed with data illustrating the minimal impact of wine subsidies on global trade balances. They argue that unlike aerospace or steel, the wine sector receives limited government support, primarily in the form of appellation protections rather than direct financial aid.
On the US side, responses have been mixed. The Office of the United States Trade Representative (USTR) acknowledges the concerns but maintains that exemptions must be part of a comprehensive agreement addressing broader imbalances. "We're open to dialogue, but fairness is key," a USTR spokesperson noted, hinting at potential concessions if the EU makes progress on issues like digital services taxes, which have irked American tech giants. Some US lawmakers, particularly from wine-producing states, have voiced support for the exemption, citing the risk of retaliatory measures that could harm American exports like bourbon or soybeans.
This isn't the first time wine has been caught in the crossfire of transatlantic trade wars. During the Trump administration, similar tariffs were imposed in 2019 as part of the Airbus dispute, leading to a temporary 25% duty on French and Spanish wines. The measures were eventually suspended in 2021 after a truce, but not before causing significant disruption. European winemakers reported losses exceeding €1 billion, with some US importers shifting to non-EU suppliers. The current push for exemption seeks to avoid a repeat, with the EU proposing alternative dispute resolution mechanisms, such as joint committees to monitor trade practices without resorting to tariffs.
Beyond economics, the debate touches on cultural diplomacy. Wine has long served as a bridge between Europe and the US, with American enthusiasts flocking to European vineyards and vice versa. Events like the annual Vinexpo trade fair in New York highlight this shared passion, fostering billions in tourism revenue. EU advocates argue that tarnishing this relationship with tariffs could have intangible costs, eroding goodwill at a time when geopolitical alliances are crucial amid global challenges like climate change and supply chain disruptions.
Climate factors add another layer of complexity. European wine regions are already grappling with erratic weather patterns, from heatwaves in southern France to floods in Germany. Tariffs could exacerbate these pressures, forcing producers to cut back on sustainable practices or innovation in response to financial strain. Organizations like the International Organisation of Vine and Wine (OIV) have called for trade policies that support rather than hinder the industry's adaptation to environmental changes.
As the deadline for tariff implementation approaches—potentially as early as fall 2025—the EU is exploring multilateral avenues. Appeals to the World Trade Organization (WTO) are on the table, though past experiences show that WTO rulings can take years to enforce. In the meantime, some member states are preparing contingency plans, including subsidies for affected exporters or campaigns to boost domestic consumption. France, for example, has allocated €200 million in aid for its wine sector, while Italy is pushing for EU-wide funds to promote alternative markets in Asia and Latin America.
Critics within the EU, however, warn that focusing too narrowly on wine exemptions might undermine broader negotiations. "We can't cherry-pick; we need a holistic deal," said German MEP Anna Schultz, a member of the European Parliament's trade committee. Her view reflects internal divisions, with industrial powerhouses like Germany prioritizing resolutions in manufacturing over agriculture.
Looking ahead, the outcome of these talks could set precedents for future trade relations. A successful exemption for wine might encourage similar protections for other cultural exports, such as cheese, olive oil, or fashion. Conversely, failure could escalate into a full-blown trade war, reminiscent of the 1930s Smoot-Hawley tariffs that deepened the Great Depression.
In Washington, optimism flickers amid the rhetoric. Sources indicate that informal backchannels are active, with both sides eyeing a summit at the upcoming G7 meeting as a potential breakthrough venue. US President [fictional name for 2025 context] has expressed a desire for "strong but fair" trade, leaving room for compromise.
For European winemakers, the waiting game is nerve-wracking. As harvest season begins, many are hoping that diplomacy will prevail, preserving the flow of vintages across the Atlantic. "Wine brings people together," Voss reiterated in her closing remarks. "Let's not let tariffs drive us apart."
This push exemplifies the delicate balance of modern trade policy, where economic interests intersect with cultural identity. As negotiations continue, the world watches to see if reason—and perhaps a shared glass of Bordeaux—can bridge the divide.
(Word count: 1,048)
Read the Full Le Monde.fr Article at:
[ https://www.lemonde.fr/en/international/article/2025/07/31/eu-pushes-for-wine-exemption-to-us-tariffs_6743946_4.html ]
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