Tag Archives: tariffs

French vintners are begging for government aid. Italian farmers are scrambling for new export markets. And American shoppers are about to face supermarket sticker shock on European products.

That’s because some $7.5 billion in U.S. tariffs on European food, wine and other goods took effect Friday, in response to illegal EU subsidies to planemaker Airbus.

The U.S. is also accused of illegal subsidies — to Boeing — and EU Trade Commissioner Cecilia Malmstrom threatened Friday to impose retaliatory tariffs on U.S. products. But she held out hope that negotiations could prevent a trade war escalation that would have global fallout.

Louis Moreau feels the sting of the Trump administration’s wine tariffs personally.

A sixth-generation Chablis producer in Burgundy, he cut his teeth in California, where he lived for 10 years before taking over the family business in 1998.

Since then, he’s worked to expand his American business, traveling to the U.S. three times a year to promote his top-quality white wines. Around 8% of his exports, or roughly 17,000 bottles, go to the U.S. each year.

“Where is the logic? It’s not fair,” Moreau told The Associated Press. He said he and other Chablis producers feel they’re being held hostage to an unrelated political dispute.

“We have good relations with our U.S. consumers,” he said.

“This whole thing — it’s a mess in a way — is really putting some stress, some tension on this relationship.”

The U.S. is the No. 1 market for French wine exports, and Moreau estimates the tariffs could cost him 80,000 euros ($90,000) in revenue over the next six months, a 20% loss of his U.S. business.

French wine exporters group FEVS asked for government help to compensate for an expected drop in sales as American consumers shun French varieties for cheaper wines from the U.S. or elsewhere.

And it’s not just France.

At Rome’s Testaccio market, which is packed with wheels of Parmesan and strung with cured meats, food shop owner Enzo Paoloantoni urged Italian politicians to fight harder to protect Italy’s economic interests.

Paoloantoni joked that “Trump was very nice to help Italians” by slapping tariffs on world-renowned delicacies that Italy prides itself on.

Italy’s main farm lobby has forecast a 20% drop in sales of agricultural products that represent half a billion euros in export value, and called on the government to help promote Italian goods in other export markets instead.

German Riesling white wine is among the many products that’s about to get more expensive for American shoppers. Germany’s government isn’t happy, but is staying prudent for now.

“We regret that it’s come to the imposition of tariffs by the U.S., because the U.S. is of course harming itself, too, in the end,” Economy Ministry spokeswoman Beate Baron told reporters in Berlin. “Higher tariffs will weigh on the U.S. economy and U.S. consumers.”

The tariffs come at a particularly bad time for French winemakers, who also feel threatened by Brexit, a contracting global economy, and a changing climate that is altering harvest patterns.

Wine association representatives have been meeting with French government officials to try to find ways to defer paying the tariffs, Moreau said.

On Friday, as the new rules took effect, workers in Moreau’s warehouse packaged more than 1,000 bottles for export — to Canada.

CÓRDOBA, Spain (AP) — Olives are harvested the old-fashioned way on Juan Luque’s farm in southern Spain, as men thrash the gnarly tree limbs with poles, raining the small green fruit into the motorized collector waiting underneath.

But for Luque and thousands of other farmers scattered across Europe’s countryside, the brewing tariffs war between Washington and Brussels over subsidies to airplane makers is putting his livelihood and countless jobs at risk.

“It is totally unfair that a commercial war in the aeronautical sector affects the agriculture sector,” he said Friday, working under the hot Spanish sun.

“European authorities must handle this and the Spanish government must handle this so (it) can get solved in a way that doesn’t affect agriculture.”

The Trump administration announced Wednesday a long list of European products it plans to place hefty tariffs on, after getting approval from the World Trade Organization over European subsidies for plane-maker Airbus. The European Union is expecting a similar ruling over U.S. subsidies for Boeing that would allow it to set tariffs on American goods.

Spain, France, Germany and Britain are shareholders in Airbus. The four were targeted with more tariffs that other EU countries.

The U.S. will place a 10% tariff on planes. But the rest of the long list of goods, mostly agriculture products that are very important to Spain such as olives and cheese, are set to be walloped with a 25% import tax.

The Spanish government said Friday that it was summoning the American ambassador in Madrid so that it could express its “complete opposition” to the proposed tariffs.

The director of the Spanish Federation of Food and Beverage Industries, Mauricio García de Quevedo, calculates that if the tariffs go into effect they will endanger 1 billion euros ($1.1 billion) worth of exports for Spain. The United States is the Spanish food and beverage sector’s second-biggest client after the EU, according to the federation.

“This type of tariff kicks you out of the market, and there is no alternative to the American market,” García de Quevedo told Spanish state broadcaster TVE.

For Rafael Sánchez, the director general of DCOOP, a cooperative of 75,000 farmers in southern Spain, the tariffs leaves Spain at a huge disadvantage to other countries, including EU members Italy and Greece, which were not targeted for olives or olive oil by the proposed tariffs.

“We have been placing big bets on the United States market for many years, for many years we have been the leaders of the olive oil market in the United States with 130 million kilos every year, and now we get a tariff exclusively for the Spanish olive oil?” Sánchez told The Associated Press. “Well that puts us in a much more complicated situation than the one Italy or Greece can find themselves in.”

The U.S. tariffs do not go into effect before Oct. 18, leaving some space for negotiations.

“The government of Spain will bring to bear all the pressure (it can),” Spain’s Minister of Agriculture, Luis Planas, said Friday.

Planas said Spain was going to push the European Commission to have the agricultural products removed from the American list.

European officials said they hope to engage the U.S. in talks on the new tariffs, but are ready to respond with taxes on American goods if needed.

“The EU must react and probably raise punitive tariffs itself after WTO approval,” German Foreign Minister Heiko Maas wrote on Twitter, in an apparent reference to a similar WTO case involving Boeing.

Maas, however, said that the EU “remains prepared to jointly negotiate rules for subsidies to the aircraft industry.”