The trade tensions between the US and Europe escalate! Trump threatens to impose a 200% tariff on EU wine

According to the Zhitong Finance APP, U.S. President Donald Trump has threatened to impose tariffs of up to 200% on European wine, champagne, and other alcoholic beverages, marking a further escalation of the ongoing trade war between the U.S. and Europe.

On Thursday, Trump stated on social media that if the European Union does not lift its tariffs on American whiskey, he will move forward with the implementation of this import tariff. The EU's tariffs on American whiskey are in retaliation for the steel and aluminum tariffs that took effect on Wednesday.

“If this tariff is not immediately lifted, the U.S. will soon impose a 200% tariff on all wines, champagnes, and alcoholic products from France and other EU member states,” Trump said regarding the whiskey tariffs, adding, “This will greatly benefit the U.S. wine and champagne industry.”

Following the announcement, the stock prices of European alcoholic beverage manufacturers fell sharply. LVMH, which owns Moët & Chandon and Veuve Clicquot, saw its stock price drop by as much as 2.2%, while cognac producer Rémy Cointreau's stock fell by 4.5%, and spirits manufacturer Pernod Ricard's stock dropped by 3.6%.

The EU is planning to take countermeasures against Trump's metal tariffs, proposing to impose tariffs on U.S. goods worth up to €26 billion (approximately $28.3 billion). The EU will also immediately consult with member states, aiming to pass a supplementary list imposing tariffs of up to 25% on agricultural and industrial products by mid-April.

Trump also promised to introduce a new round of tariffs within three weeks, stating that he would begin implementing reciprocal tariffs. The White House plans to calculate a uniform tax rate based on the tariff levels of various countries and other trade barriers (such as digital taxes or value-added taxes) to apply to each country.

This move could further intensify the trade war, forcing countries to take retaliatory measures, which may prompt Trump to impose more tariffs under the guise of reciprocity. Trump also promised to implement separate industry tariffs on sectors such as automobiles, timber, semiconductors, pharmaceuticals, and copper.

Trump is advancing his broad tariff agenda in a piecemeal manner, a strategy filled with uncertainty, including delays, reversals, and directional adjustments. On Tuesday, Trump threatened to double the tariffs on Canada’s upcoming tariffs, but he retracted this threat just hours after Ontario suspended the electricity export surcharge.

Using tariffs as leverage in economic and geopolitical disputes is putting pressure on the markets. The S&P 500 index has fallen nearly 10% from its February peak, raising concerns about a recession. On Wednesday, the U.S. market rebounded after weeks of turmoil and declines.

During his first term, Trump often viewed the stock market's rise as validation of his policies, but he dismissed the impact of this market sell-off, claiming it was a necessary step to reshape American industry and supply chains. However, support for his tariff offensive from the market has been lukewarm at best, with many industry groups calling for exemptions, and economists warning of potential ripple effects on the economy.

During his first term, Trump vowed to impose comprehensive tariffs on French wine in response to the French government's tax policies on American tech companies, but later retracted this threat after reaching a truce with French President Emmanuel Macron