Cognac: Negotiations between France and China have not resulted in a solution "at this stage"

French cognac remains "at this stage" subject to Chinese sanctions, Economy Minister Eric Lombard said Thursday after a meeting with Chinese Vice Premier He Lifeng, who called for a "more equitable" business climate between the two countries.

Discussions between France and China regarding the dispute over French cognac have not resulted in a solution "at this stage," the French minister said on Thursday following a meeting with the Chinese leader.

"But I know, having spoken at length with His Excellency He Lifeng, that the door to discussion remains open," he continued, at a time when Chinese sanctions against this sector are severely affecting the French industry.

After having led negotiations in Geneva with the United States on behalf of China in recent days on the issue of punitive customs duties , He Lifeng concluded a three-day visit to France on Thursday during which he met with representatives of cosmetics, pharmaceutical and aeronautics companies, and visited a farm in the Eure region.

On Thursday, the 10th edition of the Franco-Chinese high-level economic and financial dialogue was held, in which, in addition to He Lifeng and Eric Lombard, French Minister of Agriculture Annie Genevard also participated, against the backdrop of a continuing conflict over Chinese sanctions on the cognac industry.

Since mid-November, temporary anti-dumping measures from Beijing have required importers of European brandies (wine spirits, mainly cognac) to deposit a deposit with Chinese customs, in retaliation for a European procedure targeting state subsidies for electric vehicles manufactured in China.

These measures have dealt a blow to the cognac industry in France, which claims to have been losing €50 million per month since their introduction. "I wanted to emphasize how important it is for us to return to the solution that prevailed before 2024," Eric Lombard said, recalling that cognac represents €1.4 billion of annual French exports to China.

"This is a matter of prime importance for France," he told the press. China alone accounts for a quarter of cognac exports, according to the French National Interprofessional Cognac Bureau.

The Chinese leader's response on the matter was brief, with He Lifeng simply saying that "at the request of the Chinese domestic industry, China has initiated an anti-dumping investigation on brandy originating in the European Union, in accordance with the law."

"The investigating authority will make a decision based on the facts," he continued.

China suspects French producers of excessively lowering the prices of their products to facilitate access to the Chinese market, an accusation that France firmly rejects. Beijing has already changed its position in recent weeks by postponing the definitive application of additional customs duties by three months, following a visit by French Foreign Minister Jean-Noël Barrot .

He Lifeng, however, expressed his hope that "French companies will increase their investments in China," just as he called on Chinese companies to "invest" and "do business in France." He also expressed openness to cooperation in the fields of artificial intelligence, climate transition, financial services, nuclear power, and agriculture.

The Chinese leader, however, was more aggressive on the subject of the business climate: his country "hopes that France will offer a climate (...) that is more equitable, fairer and more predictable," he said.

In addition to the conflict over cognac, France has not exported beef to China since the end of 2024, due to a total embargo decreed by Beijing, linked to bluetongue (BT) , a disease not transmissible to humans which mainly affects sheep but also cattle.

French beef is "welcome" on the Chinese market, the Chinese Vice Premier declared on Tuesday during a visit to a cattle farm in Harquency (Eure), without giving any timetable or details on the lifting of current restrictions.