China Announces Duties on Brandy

Tensions between the European Union and China are intensifying as Beijing announced tariffs on European brandy, especially French cognac, following the EU’s tariffs on Chinese electric vehicles (EVs). The trade dispute stems from the EU's decision on October 4, 2024, to impose tariffs on Chinese EVs, citing state subsidies that gave Chinese manufacturers an unfair advantage.
 

In response, Beijing announced on October 8, 2024, that importers of European brandy would need to place security deposits with customs starting October 11, 2024. Cognac, which accounts for 95% of European brandy exports to China, is a primary target.

China’s Ministry of Commerce justified the move, calling the EU’s tariffs unjustified and vowing to protect its industries under international trade laws. Meanwhile, the EU defended its decision, stating that the EV tariffs followed a thorough investigation into unfair subsidies.

French cognac producers are bracing for significant losses, as China is one of their largest markets outside of the EU. The tariffs could lead to a decrease in sales and competitiveness in the Chinese market.

Diplomats from both sides are urging restraint, fearing the dispute could broaden to other sectors, further straining the economic relationship between the two trade giants. Businesses on both sides are hoping for a negotiated resolution before the situation escalates further.

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