Brussels, 15 Jan 2020 (Lusa) – European Union (EU) member states today agreed on measures to protect European wines, including Portuguese wines, from additional US tariffs, with changes to promotion campaigns for the wine sector allowed.
According to information sent by the European Commission to the Lusa agency, these measures come in the context of the application of 25% tariffs by the United States on EU agricultural products, in retaliation for a trade dispute between Washington and Brussels.
The measures to protect European wines agreed today by EU countries – proposed by the European Commission and now to be approved by the College of Commissioners – then aim to “increase flexibility in the management of promotional activities for the wine sector within their national support programs”.
Specifically, this means that it will now be possible for member states to change the target markets (country, region or city) of the promotional activities already approved, without limitation in the new destination, which could be important if US tariffs directly affect the ‘exit’ of European wine in the United States.
It will also be allowed for EU countries to modify the promotion activities of their national support program more than twice a year and to suspend promotion activities for a period of five years until the end of the current period (i.e. 15 October 2023).
In addition, there will be an increase in the EU co-financing rate for the sector from 50% to 60%, with producers covering the remainder.
For these measures to enter into force, regulation will also have to be adopted by the European Parliament and the Council.
In the information sent to Lusa, the European Commission assures that it “will continue to closely monitor the impact of the US measures on EU wine exports”.
At the beginning of October, the World Trade Organization (WTO) decided in favor of the United States and authorized the country to apply additional tariffs of $7.5 billion (almost 7.5 billion) on European products, in retaliation for EU aid to the French aircraft manufacturer, Airbus.
This was the heaviest sanction ever imposed by that organization.
However, last December WTO judges argued that these additional tariffs should be reduced by about two billion dollars to nearly five billion dollars (almost the same in euros).
With this permission, we are talking about 10% tariffs in aeronautics and 25% in agriculture throughout the EU.
Portuguese wine represents 45.2% of the total volume of national exports and its main markets are France (42.6 million liters), Germany (25.7 million liters), Angola (22.8 million liters), the United Kingdom (21.7 million liters) and the United States of America (20.8 million liters).
In terms of value, France leads the markets of destination with EUR 114.5 million, followed by the United States (EUR 80.8 million), the United Kingdom (EUR 75.5 million), Brazil (EUR 51.5 million) and Belgium (EUR 49.7 million).