Trump threatens 200% tariffs on French wines to get Macron on Board of Peace

Trump's initiative, which would start by addressing Gaza and then expand to deal with other conflicts, raises questions about the role of the United Nations and a source close to Macron said the French president intended to decline the invitation to join.

When asked about Macron's stance, Trump said, "Did he say that? Well, nobody wants him because he will be out of office very soon."

"I'll put a 200% tariff on his wines and champagnes, and he'll join, but he doesn't have to join," Trump said.

WINE TARIFF THREAT PART OF BROADER SALVO AGAINST EU

Macron is due in Davos for the day on Tuesday before a scheduled return to Paris in the evening. Elysee aides have said there are no plans to extend his stay to Wednesday, when Trump arrives in the Swiss mountain resort town.

In another shot at the French leader, Trump published a private message from Macron in which he said he did not understand Trump's actions over Greenland. France holds an election to replace Macron in 2027.

Wines and spirits exported to the United States from the European Union currently face a 15% tariff - a rate the French have been lobbying hard to reduce to zero since Trump and European Commission President Ursula von der Leyen agreed a U.S.-EU trade deal in Scotland last summer.

The United States is the largest market for French wine and spirits, with shipments to the U.S. at 3.8 billion euros in 2024.

"The fact that we're getting more threats is going to make the industry harder to invest in, it's going to make it harder for companies to make decisions for their own investments," said Laurence Whyatt, head of European beverages research at Barclays.

"They will have to be more reserved, keep a bit of cash back, not invest, because they need to be able to weather the storms as and when they come."

Shares in luxury conglomerate LVMH, which owns major champagne producers including Moet & Chandon, were down 2% in early trading.

Gabriel Picard, chairman of the French wine and spirits export lobby FEVS, told Reuters on Monday, before the new threat, that the industry had seen a 20% to 25% hit to U.S. activity in the second half of last year from previous trade measures.

A Macron aide said the Elysee took note of Trump's remarks and stressed that tariff threats to influence a third party's foreign policy were unacceptable.

TRUMP'S THREATS ARE "BRUTAL", FARM MINISTER SAYS

Europeans are weighing their own 93 billion euro tariff riposte and even the use of the bloc's "Anti-Coercion Instrument" to retaliate against a separate threat of tariff hikes against a group of European states over Greenland.

"It's brutal, it's designed to break us, it's a tool for blackmail. All of this is outrageous," French Farm Minister Annie Genevard told news channel TF1.

"We have the tools; Europeans must take responsibility. We cannot allow such an escalation."

Trump has threatened a 200% tariff on wine and other alcoholic beverages imported from the EU before, including last year in March as transatlantic trade tensions escalated.

Governments have reacted cautiously to Trump's Board of Peace invitation, a plan that diplomats said could harm the work of the United Nations.

A draft charter sent to about 60 countries by the U.S. administration calls for members to contribute US$1 billion in cash if they want their membership to last more than three years, according to the document seen by Reuters.