Trump threatens 200% tariffs on EU wines and spirits, escalating trade war and affecting European drink company shares.
In Short
President Trump has proposed a 200% tariff on EU alcohol imports in response to the EU’s 50% tariff on American whisky, heightening trade tensions. The ongoing conflict could affect over $10 billion in EU exports to the U.S., prompting potential retaliation from the EU.
President Trump has intensified his trade conflict with the European Union by announcing a potential 200% tariff on U.S. imports of wine, Champagne, and other alcoholic beverages from the EU.
This decision follows the EU’s imposition of a 50% tariff on American whisky. Trump emphasised this in a post on his Truth Social platform, indicating that the U.S. would respond strongly if the EU does not remove its tariffs.
The escalating exchange has led to declines in shares of European beverage companies, with the possibility that over $10 billion of EU exports to the U.S. could be impacted. In 2024, the U.S. had imported about $5.4 billion worth of wine from the EU.
French Trade Minister Laurent Saint-Martin condemned Trump’s actions, indicating that France, alongside the European Commission, is prepared to retaliate. Meanwhile, an EU spokesman noted that Brussels has been in contact with U.S. officials to discuss the tariffs.
The EU plans to impose its own tariffs on American products like whisky and motorcycles, aiming to counter the U.S. metal tariffs. The Distilled Spirits Council of the United States is advocating for a tariff-free trade agreement between the U.S. and the EU to benefit both economies.
The trade tensions have notably affected major players like LVMH and Pernod Ricard, with share prices declining amid the uncertainty. The situation remains fluid as both sides prepare for further discussions.
