The European Union is launching a commercial investigation targeting European spirits sold in China. Beijing suspects certain EU countries of subsidizing these products to then sell them at a higher price on the Chinese market. First target: French cognac. And an entire industry is worried about possible retaliatory measures.
“ This is where the cognac is put, before being bottled. » On a production line, employees fill bottles of cognac before labeling them. Every year, Bache Gabrielsen sends between 50 to 100,000 bottles to China. But since the opening of an investigation by Beijing on January 5, the boss of the SME has been spending more time at his office. “ Here, for example, in this questionnaire, you have a tab on purchases, on production capacities. » In these questionnaires, Hervé Bache Gabrielsen must prove to the Chinese authorities that his cognac is not sold more expensively on the Chinese market than elsewhere in the world.
“ This anti-dumping investigation took the form of very detailed questionnaires where we had to provide a large amount of precise information on our know-how and our production. It was first given in Chinese, but then fortunately translated. Above all, it takes time and money, it mobilizes teams. For some houses, we are talking about several hundred thousand euros. It is like a sword of Damocles, if you take additional customs duties in the event of application of these anti-dumping taxes, it will be additional difficulties for selling our products. »
The threat also hangs over wine growers
On his farm, Anthony Brun produces grapes which will then be transformed into wine and then distilled to make cognac, partly for the Chinese market. ” VSIt’s a very buoyant market. We have been defining growth prospects for several years now with traders. On my 30 hectare farm, I have 15 hectares of renewed vines. All these investments were made to meet the wishes of the consumer. In this case the Chinese. If tomorrow consumers cannot buy because the price has been biased by a tax, we will have made investments that are not necessarily profitable. »
In France, the cognac sector represents 70,000 direct and indirect jobs and brings in over 6 billion euros each year. “ We will assert our rights before the WTO, but we know that it could take years », apprehends Florent Morillon, the president of the national inter-professional cognac office
In the meantime, the industry is busy behind the scenes. After a meeting last month with the Chinese Minister of Commerce, the representatives are banking on Xi Jinping’s visit to Paris. The Chinese president is expected in early May. The French government assures that the fate of French cognac will be at the heart of discussions.
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