In France's southern wine region, Trump's tariff threats are already killing business

Grapevines crossed confederate France's famed vino portion person hardly begun to bud, but the play has already turned sour for galore of Europe's apical producers.

"We person 1 [worker] that near ... due to the fact that we couldn't wage him anymore," said Nadine Auray, who with her husband, Pierre Jauffret, and a tiny unit runs Château Terre Forte, extracurricular of Avignon.

"So that's 1 feline retired of a occupation and we person to find immoderate different markets."

Jauffret says U.S. President Donald Trump's tariff threats are already a catastrophe for some French producers and American vino consumers. 

"I deliberation helium volition termination the vino marketplace successful the U.S.A.," said Jauffret.

Trump has threatened Europe's intoxicant producers with a catastrophic 200 per cent tariff arsenic portion of a nasty tit-for-tat commercialized quality that Trump himself initiated. It began with U.S. enactment against aluminum and steel, but present includes cars and car parts and wine.  

"We should person an bid successful April for the U.S. markets, and contiguous they said they won't order," Auray told CBC News during a sojourn to the winery earlier this week. "It's our main importer successful California."

Tariffs are paid by importers arsenic they participate the United States, and since shipments are ordered acold successful beforehand and instrumentality months to arrive, it's intolerable for U.S. buyers to cognize what they'll beryllium paying oregon whether customers volition beryllium prepared to screen the other markup.

Exports crucial

Château Terre Forte produces astir 15,000 bottles a twelvemonth — mostly reddish — connected 25 hectares of vineyards. Seventy per cent of the couple's vino is exported, and portion Canada is really their biggest overseas market, the 10 per cent that goes to California and New York is highly important, says Auray. 

She says the distributor who called disconnected the merchantability this week was profoundly apologetic, but said they couldn't instrumentality the accidental of being stuck with thousands of bottles of French vino that could extremity up much costly than they had planned.

"[The importer] said helium was atrocious for us, and I was atrocious for them. They cognize their ain concern could spell down and dice due to the fact that of these tariffs," Auray said. 

Europe exports much than $14 cardinal US of booze and vino to the U.S. each year. French vino accounts for conscionable implicit $2 cardinal of that.

The French manufacture had already been grappling with broadly decreasing planetary sales, resulting from different commercialized disputes with countries specified arsenic China, arsenic good arsenic the impacts of clime alteration and an wide diminution successful intoxicant depletion worldwide.

On Friday, the EU unveiled a big of enactment measures for the manufacture that it had been moving connected for months, including other fiscal assistance to beforehand tourism, overseas advertizing campaigns and cutting reddish portion for growers.   

Retaliation question

Exactly what Trump and his officials person successful caput for European alcoholic products is uncertain.

The U.S. president has threatened to deed each EU imports with a imaginable 25 per cent tariff, which would successful mentation see wine. Then, there could beryllium different duties triggered by European retaliation. 

After the U.S. imposed duties connected European alloy and aluminum earlier this month, Trump raised the spectre of the 200 per cent punishment connected alcohol should the EU deed backmost against American whiskey.

The retaliation question came up again this week, aft the U.S. said each European vehicles volition look a 25 per cent tariff starting connected April 2. European commercialized officials near a gathering with Trump officials astatine the White House despondent, saying it appeared tariffs of astatine slightest 20 per cent were inevitable.

Wine producers accidental fixed Trump's unpredictable edicts and misinformation, it's intolerable to cognize however they should respond successful the weeks and months ahead. 

"How tin you find a strategy for idiosyncratic who has nary — because [Trump] has nary strategy," said Auray, claiming it feels similar producers are surviving connected "quicksand" with each the uncertainty. 

During his archetypal word arsenic president, Trump imposed 25 per cent duties connected a smaller enactment of EU-produced goods, including galore wines, arsenic punishment for European hose subsidies. Those penalties were lifted successful 2021, aft Joe Biden became president.

Ulterior motive?

Paris-based economist Anne-Sophie Alsif says she believes Trump is utilizing tariffs to thrust EU negotiators backmost to the bargaining array implicit a abstracted issue, involving laws that regulate how U.S.-based tech giants tin run successful Europe. 

The EU has vigorously pursued aggregate antitrust cases against large U.S. tech firms specified arsenic Google, Microsoft and Apple, arguing these companies person abused their ascendant positions, stifled competition and harmed consumers. Two caller EU laws, the Digital Services Act and the Digital Markets Act, person besides attempted to enforce standards connected misinformation and hate speech.

"I deliberation that each these assertive [U.S.] commercialized policies are possibly to reappraisal this tech deal, and to person much favourable conditions for American companies regarding digital," said Alsif.

In trying to combat backmost against Trump's tariff measures, Canadian and European governments find themselves joined successful a communal origin — but not needfully 1 they are inclined to combat together.

"We volition combat the U.S. tariffs with retaliatory commercialized actions of our ain that volition person maximum interaction successful the United States and minimum impacts present successful Canada," Prime Minister Mark Carney said astatine a quality league connected Thursday, possibly trying to region Canada from immoderate reciprocal measures Europe takes.

WATCH | Carney heads to Europe to fortify alliances:

Nonetheless, successful a societal media station aboriginal that day, Trump linked the Canadian and European actions anyway.

"If the European Union works with Canada successful bid to bash economical harm to the USA, ample standard tariffs, acold larger than presently planned, volition beryllium placed connected them both," helium posted.

Looking elsewhere

Some French vino producers person already started the long, tedious process of trying to find caller markets.  

Marin Stoffer, with champagne shaper Roger-Constant Lemaire, says his operation, based not acold from the French metropolis of Reims, is 1 of them.

"We are going to Canada successful May, to Calgary and Vancouver ... we besides person to people different markets and look for the opportunities up there," Stoffer told CBC News.

But helium added that opening caller markets is time-consuming and often doesn't wage off, particularly when the United States is the apical planetary marketplace for French champagne.

Roland Lescure, a lawman successful the French National Assembly who represents overseas French citizens successful Canada and the U.S., said "French radical are worried."

A dual Canadian citizen who held salient roles successful Quebec's Deposit and Investment Fund, said the presumption of France's authorities for the moment is to promote negotiations alternatively than contiguous retaliation. Although he admits it could yet travel to that.

"We request to beryllium firm. We request to beryllium strict. We request to beryllium strong," said Lecure, during a CBC News interview successful Paris. "But besides beryllium wary that if we bash spell into that commercialized commercial war, we each are going to lose."

Lescure told CBC that Trump's commercialized war, on with his dressing down of Ukrainian President Volodymyr Zelenskyy successful the Oval Office and his clasp of Russian narratives implicit the warfare successful Ukraine, have contributed to a precipitous driblet successful however French radical comprehend the U.S.

"Only 20-plus per cent of French radical genuinely judge that the U.S. is their ally," helium said. "That's a large alteration — I mean, this has changed overnight."