China to require major EU brandy exporters to raise prices
Almost all EU brandy is cognac produced in France, exports of which to China are worth 1.4 billion euros (US$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.
France's umbrella cognac producers association BNIC — which covers key producers from Hennessy to Remy Cointreau and Martell — confirmed the deal to avoid levies by hiking prices, calling it a 'less unfavourable' outcome.
Still, the European Commission said Friday after the announcement that it 'regrets China's decision'.
'We believe that China's measures are unfair. We believe they are unjustified. We believe they are inconsistent with the applicable international rules and are thus unfounded,' said the commission's trade spokesman, Olof Gill.
China has sought to improve relations with the European Union as a counterweight to superpower rival the United States.
But deep frictions remain over their economic relationship — including a yawning trade deficit of US$357.1 billion between China and the EU, as well as Beijing's close ties with Russia despite Moscow's war in Ukraine.
Bitter taste
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.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
HKFP
4 hours ago
- HKFP
‘Highlight of my career': Former US consul general Gregory May on his tenure and a changing Hong Kong
When Gregory May came to Hong Kong in 1992, he stayed at Chungking Mansions – a sprawling, labyrinthine building in Tsim Sha Tsui known for its affordable guesthouses and cultural diversity. At the time, May was a 21-year-old university student passing through Hong Kong en route to Taiwan, where he had enrolled in a one-year programme to study Chinese. After finishing his undergraduate degree and a stint in journalism, May joined the US government for a career in diplomacy. His job took him to places including Italy, Mongolia and mainland China, and in September 2022, Hong Kong. During his last week in the city, 55-year-old May was back at Chungking Mansions, where he enjoyed a cup of masala chai and had his face threaded. After serving as the consul general for Hong Kong and Macau for almost three years, May has moved to Beijing to become second-in-command at the embassy there. Speaking to HKFP last Sunday at his home near the Peak, the diplomat said he was leaving Hong Kong with 'genuine warm feelings' for the city. Outside, in preparation for a farewell party for the consul general, house staff inflated bouncy castles – entertainment for the kids while the adults mingle. 'You can believe that Hong Kong is a wonderful city and still disagree with the policies of the mainland Chinese and Hong Kong governments,' May told HKFP. 'Testy' relationship During May's time as the top US diplomat in Hong Kong, the city enacted its second national security law, two landmark national security trials were underway, and major pro-democracy parties disbanded. There have also been 'ups and downs' in the broader US-China ties, May added. Amid these developments, May described the US government's relationship with Hong Kong authorities as 'testy with room for dialogue.' The diplomat said his 'main concern' during his tenure had been Jimmy Lai, the founder of the now-defunct pro-democracy newspaper Apple Daily. Lai is on trial for conspiring to collude with foreign forces under the Beijing-imposed national security law. However, 'our concern goes beyond Jimmy Lai… you have people who are in jail for participating in political activity that was specifically allowed for in the Basic Law,' May said. 'People [are] in jail for criticising the government online.' 'That's been difficult to witness, and over the three years, that's gotten more challenging in terms of human rights.' In response to HKFP's enquiries, the Hong Kong government said that attempts to 'procure a defendant's evasion of the criminal justice process' are a 'blatant act' of undermining the rule of law. US politicians should 'immediately stop interfering in [Hong Kong]'s internal affairs and the independent exercise of judicial power,' it added. May also commented on the Hong Kong police's arrest warrants and bounties on 19 overseas activists under the Beijing-imposed national security law. Some of these activists now live in the US, and at least one of them is a US citizen. 'Their alleged crimes [include] things they've said in the United States in our case, under our constitutional protections,' he said, adding that the Hong Kong police were trying to 'suppress free speech in my country.' In its reply to HKFP, the Hong Kong government said the security law's extraterritorial effect 'fully aligns with the principles of international law.' 'Those absconders hiding in the US and other Western countries are wanted because they continue to blatantly engage in activities endangering national security,' it wrote. Still, May said the US had 'good communication overall' with Hong Kong, and that there had been solid cooperation on issues such as combating drug shipments and scams. He added that several lawmakers have been open to discussion despite their disagreements on certain US and Hong Kong policies. 'There is still a group… in some circles of the government that still value maintaining cooperation,' he said. Responding to May's comment about the 'testy' US-Hong Kong relationship, the city's authorities pointed out the ties between the two governments in areas such as trade, education and culture. The US's trade in goods with Hong Kong supports about 140,000 jobs in the US, they said. 'The shared interests between Hong Kong and the US have allowed us to develop a multifaceted and longstanding relationship over the years,' the government said. 'Pressure from outside' The US consulate has not been immune to the city's politicised landscape, May said. Outside of the law, the diplomat said he had observed 'softer repressive measures' aimed at stifling certain groups' 'perfectly legal activities' – and he himself had experienced that first hand. Like the Democratic Party, the city's largest pro-democracy political party, and the Hong Kong Journalists Association, which have faced difficulties securing venues for their annual dinners, the US consulate has encountered similar problems with finding hosts for its events, May said. 'We're doing something in an outside venue, and suddenly there's a plumbing problem over there, or there's some excuse for why the venue is no longer available,' he said. May said it 'hasn't happened very often,' but it had been with 'increasing frequency.' 'It's very clear that this is pressure from outside. Phone calls are made… they get the message that they shouldn't be hosting anything,' he said, adding that these incidents happened closer to the end of his time here. In response, the government told HKFP it had 'no comment' and that rights and freedoms remain protected. Compared with the earlier parts of his tenure, May said he received fewer invitations and had fewer opportunities to give talks at secondary schools to promote higher education in the US. He said he had also had requests to speak at universities rescinded, which he attributed to 'external pressure.' May also expressed concerns about the city's media landscape, saying there had been a 'real deterioration.' Regarding press freedom, the diplomat lamented the demise of political cartoonist Wong Kei-kwan, known as 'Zunzi.' The cartoonist, known for his satirical takes on current affairs, used to have a regular column in the Chinese-language local newspaper Ming Pao. Fluent in Mandarin, May said he subscribed to Ming Pao to keep up his Chinese reading and to read Zunzi's cartoons. The comic strip was suspended in May 2023 after being criticised by authorities. 'I love the cartoons by Zunzi,' May said. 'They're funny, [and] it's a challenge to figure out the Cantonese and the special sayings.' 'He criticised the United States, he criticised a lot of different people in those cartoons, and we can't see them anymore,' he said. 'And we all know why.' The Hong Kong government has repeatedly said that press freedom is not absolute and defended the media landscape, calling it 'as vibrant as ever.' Going local The turbulent relationship between the US and China – and by extension, Hong Kong – may have defined May's tenure in the city. But that is perhaps not what most Hongkongers will remember him for. Videos on the US consulate's Facebook and Instagram pages featuring him shopping at a wet market and riding a minibus, while showing off his earnest, if not imperfect, Cantonese, have racked up hundreds of thousands of views. A four-second clip posted last month, showing him perfectly splitting a piece of tissue in two, has over 300,000 views on Facebook. 'I just found out that many people in Hong Kong have a habit of sharing tissues. Do you think I tore mine the right way?' the caption reads. May said his time in Hong Kong had 'really been the highlight of my career.' Besides the people, the diplomat said he would miss his walks to the Peak from his residence, Ocean Park trips with his son, and above all else, food. 'Hong Kong has so many Michelin-star restaurants… but I think the best places to eat are the ones that don't take Octopus or credit card. Cash only,' he said. The diplomat counts wonton noodles and two-dish rice as his favourites. His go-tos for the latter are preserved sausage and a vegetable like xiao bai cai, a type of Chinese cabbage. Reflecting on the political developments during his almost three years in Hong Kong, May said he would still encourage Americans to move to the city. 'You just have to be knowledgeable about some of the changes here. You need to be mindful of things like the national security law and Article 23,' he said, referring to the homegrown security law passed last year. 'Hong Kong has changed. Hong Kong, fundamentally, is not the free society that it used to be.'
South China Morning Post
17 hours ago
- South China Morning Post
China, EU close to EV tariff deal, state media says, dismisses ‘trade diversion' fears
China and the European Union have largely finalised the 'technical' part of negotiations towards resolving their electric vehicle (EV) tariff dispute, with the deal now hinging on 'political will' from the European side, according to Chinese state-affiliated media. Yuyuan Tantian, a social media account linked to state broadcaster CCTV, reported on Friday night that the 'technical negotiations' were essentially complete, with only the 'final step' remaining. 'The key now depends on whether the EU can demonstrate the necessary political will to push for a resolution of the issue,' it said. Meanwhile, state news agency Xinhua in a commentary on Saturday dismissed claims of a new 'China shock', describing fears that Chinese exports deflected by US tariffs were flooding Europe as 'grossly overstated'. In April, China and the EU agreed to negotiate a 'price undertaking' mechanism that would allow Chinese EV makers to avoid tariffs by adhering to minimum export prices. The dispute centres on EU tariffs of up to 45.3 per cent imposed last October on Chinese EVs, to counteract what Brussels sees as an unfair edge enjoyed by Chinese manufacturers due to huge state subsidies and lower production costs. The reported progress in the talks comes ahead of a critical EU-China summit that is expected to primarily focus on trade issues. EU leaders led by European Commission President Ursula von der Leyen are expected to visit Beijing later this month as the two sides mark 50 years of diplomatic ties. Over the past two years, the EU has persisted in challenging Beijing on trade issues, including subsidies, alleged dumping and other practices that 'distort the market', with numerous investigations either ongoing or at the planning stage.
South China Morning Post
18 hours ago
- South China Morning Post
China, EU close to EV tariff deal, state media says, dismisses ‘trade diversion' fears
China and the European Union have largely finalised the 'technical' part of negotiations towards resolving their electric vehicle (EV) tariff dispute, with the deal now hinging on 'political will' from the European side, according to Chinese state-affiliated media. Yuyuan Tantian, a social media account linked to state broadcaster CCTV, reported on Friday night that the 'technical negotiations' were essentially complete, with only the 'final step' remaining. 'The key now depends on whether the EU can demonstrate the necessary political will to push for a resolution of the issue,' it said. Meanwhile, state news agency Xinhua in a commentary on Saturday dismissed claims of a new 'China shock', describing fears that Chinese exports deflected by US tariffs were flooding Europe as 'grossly overstated'. In April, China and the EU agreed to negotiate a 'price undertaking' mechanism that would allow Chinese EV makers to avoid tariffs by adhering to minimum export prices. The dispute centres on EU tariffs of up to 45.3 per cent imposed last October on Chinese EVs, to counteract what Brussels sees as an unfair edge enjoyed by Chinese manufacturers due to huge state subsidies and lower production costs. The reported progress in the talks comes ahead of a critical EU-China summit that is expected to primarily focus on trade issues. EU leaders led by European Commission President Ursula von der Leyen are expected to visit Beijing later this month as the two sides mark 50 years of diplomatic ties. Over the past two years, the EU has persisted in challenging Beijing on trade issues, including subsidies, alleged dumping and other practices that 'distort the market', with numerous investigations either ongoing or at the planning stage.
