Shares in French companies with exposure to wine and Champagne came under pressure on Tuesday after U.S. President Donald Trump warned he could impose tariffs of up to 200% on the products.
Luxury group LVMH (EU:MC), which owns Champagne brands including Veuve Clicquot and Krug, was down more than 4% in mid-morning European trade. Other producers also weakened, with Remy Cointreau (EU:RCO) falling 1.9%, Laurent-Perrier (EU@LPE) slipping 0.7%, Maison-Pommery & Associes (EU:POMRY) down 0.4% and Lanson BCC (EU:ALLAN) easing 0.3%.
Trump indicated that the steep tariffs could be used as leverage to persuade French President Emmanuel Macron to participate in his proposed “Board of Peace”, an initiative he claims would focus on resolving global conflicts.
According to reports, the Board of Peace has sparked concern among diplomats who fear it would weaken the influence of the United Nations. The initiative would reportedly be chaired by Trump for life, starting with efforts to address the conflict in Gaza before expanding to other international issues.
Under the proposal, countries would face three-year membership terms unless a $1 billion fee was paid to support the board’s activities, Reuters reported. Diplomats cited by the news agency said up to 60 countries had been invited to join, although a source close to Macron suggested France was likely to reject the offer.
Asked directly about Macron’s stance, Trump said, “I’ll put a 200% tariff on his wines and Champagnes, and he’ll join, but he doesn’t have to join.”
The remarks mark the latest escalation in Trump’s trade rhetoric toward Europe. In recent days, he has also claimed he would impose 10% tariffs on several European countries unless the U.S. is allowed to take ownership of Greenland, a semi-autonomous Danish territory. He added that these duties could rise to 25% in June if his demands are not met.
European leaders have described the threats as a form of economic blackmail and are reportedly weighing their response, including a potential €93 billion package of retaliatory tariffs on U.S. goods. France and Germany have also urged the European Union to consider deploying an anti-coercion instrument that could restrict U.S. access to the EU, collectively the world’s third-largest economy.
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