Wine watches from the sidelines as commercial hostilities flare

Wednesday March 14 2018 by Marion Sepeau Ivaldi

Without wishing to be overly pessimistic, the squabbling between the United States and the European Union on trade policy has a musty smell and an aftertaste reminiscent of photovoltaic panels. What fate is in store for the European wine industry in this game of ping-pong, where one-upmanship seems to be the only rule? Donald Trump has announced increased tariffs on steel (though has avoided implicating two of his major partners, Canada and Mexico), prompting threats from Europe. And predictably, Europe’s response – i.e. taxing certain iconic American goods - has fuelled threats of retaliation across the Atlantic. However, it is unclear which industry would bear the brunt of the retaliation.

It is only natural to think of wine. Not only because it is a cultural symbol, but also because the United States is one of the leading strategic markets for the European wine economy. France, Italy and Spain have invested heavily in the American market (with a great deal of European aid) to gain market shares. If taxes were to increase, the development of European wines would automatically be hampered, particularly in the entry and mid-range segments. The European wine industry is therefore watching the match on both sides of the Atlantic, keeping as low a profile as possible in the hope of being forgotten and praying that it won't be turned into the scapegoat of the battle.

 

 

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