China’s hit at EU brandy sparks fear of all-out trade war
Other European agriculture sectors, such as dairy and pork, fear similar measures. Ten EU countries voted in favor of the duties, including the Netherlands, Italy and Poland, and risk being more exposed to China’s retaliation. Germany and Hungary, on the other hand, were among the five countries to vote against the duties.
Spain is particularly vulnerable to the potential duties on pork, and Madrid abstained for that reason last Friday. Speaking to POLITICO on Monday, the country’s Minister for Economy and Trade Carlos Cuerpo said the EU needs to keep negotiating with China “to avoid an escalation of these protectionist measures that, in the end, provide for a lose-lose situation.”
However, analyst Gregor Sebastian at the Rhodium think tank said he considers the Cognac duties too small to change the minds of EU policymakers. “If China would go after larger agricultural exports from the EU or, for instance, luxury goods, cosmetics or cars, it could soon be a different story.”
The EU will challenge China’s decision at the World Trade Organization, spokesperson Olof Gill said.
Giovanna Faggionato contributed to this report.
This story has been updated.