China's Tariff Retaliation: Europe Faces Scrutiny Over Brandy Exports

China has announced temporary anti-dumping measures on European brandy imports, affecting French brands such as Hennessy and Remy Martin, following EU tariffs on Chinese-made electric vehicles. This move is viewed as retaliation and could lead to more stringent trade measures between China and the EU.

In a significant move against European trade, China has imposed temporary anti-dumping measures targeting the import of brandy from the EU, with French brands such as Hennessy and Remy Martin bearing the brunt of the impact. This comes in the wake of the EU's vote to levy tariffs on Chinese-manufactured electric vehicles (EVs).

The Chinese commerce ministry asserted that the importation of European brandy poses a substantial threat to domestic industry, insinuating potential escalations in trade measures. An ongoing investigation into EU pork imports might result in further tariffs, alongside potential increases on large-engine vehicles primarily affecting German automakers.

With security deposit rates set between 34.8% to 39.0% for European brandy imports, luxury goods companies face significant cost challenges. Consequently, shares of key players in the luxury goods sector have plummeted, stirring concerns about the broader impact of trade tensions on profits heavily dependent on Chinese markets.

(With inputs from agencies.)