France has said it will defend its producers in the face of threats from China to target European wine imports in an anti-dumping and anti-subsidy investigation.
The move is seen as a response from Beijing to the EU accusing Chinese of exporting solar panels for less than they cost to make – dumping as it is known – to undercut European manufacturers and dominate the industry.
France’s trade ministry is worried about escalation.
Xavier-Luc Linglin, who heads Bonfils Group, with vineyards in Languedoc Roussillon and Bordeaux, said: “We can’t afford to lose this market, we can’t afford to have the market decline as this is our top export region in terms of earnings and the second largest in terms of volume. So we would not be able to make up for reduced sales to China, that’s for sure.”
As consumption in China soars, half of the wine imported into the country last year was French.
So France – which is in favour of the punative tariffs on solar panels – would be most affected by the move, which Paris called “inappropriate and reprehensible”.
Sending a signal
This is seen as China sending a signal and trying to avoid the trade dispute escalating.
For its part, the European Union is imposing tariffs on imports of Chinese solar panels from this week, but is holding off from the full 47.6percent rate for now.
That follows pressure from some large member states led by Germany, which is worried about its exports to China. They are pushing for a negotiated settlement with Beijing. Perhaps not coincidentally the countries which oppose the duties don’t sell a lot of wine to China.
China’s Commerce Ministry said the EU penalties were imposed despite Beijing making great efforts and showing enormous sincerity in trying to resolve the matter through talks.
“The European side still obstinately imposed unfair duties on Chinese imports of solar panels,” the ministry said in a statement on its website.
Any action is unlikely to be popular with Chinese consumers. “We Chinese love French wines. They’re so sophisticated and go down so well,” said Niu Lanxiang, 23, a logistics worker out shopping for wine in a supermarket in Beijing’s fashionable Sanlitun district.
“I know wine is more of a Western habit, but China is a modern country now too and we’re learning how to enjoy wine,” she said.
However, not all Chinese share her cultured palate; some still prefer to drink wine mixed with Coca-Cola or Sprite.