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Macron Strengthens China Ties, Pushes for Cognac Trade Resolution

by Team Lumida
May 22, 2025
in Markets
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Macron Strengthens China Ties, Pushes for Cognac Trade Resolution
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Key Takeaways:

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  • French President Emmanuel Macron emphasized the importance of a “strong economic relationship” with China during a call with President Xi Jinping, welcoming Chinese investment in France while advocating for fair competition for French companies in China.
  • Macron highlighted progress on resolving China’s anti-dumping investigation into Cognac and Armagnac, which has been a point of contention for French spirits makers like LVMH, Rémy Cointreau, and Pernod Ricard.
  • The two leaders discussed shared goals for peace in Ukraine and collaboration ahead of the UN conference on a two-state solution to the Arab-Israeli conflict in June.

What Happened?

President Macron reaffirmed France’s commitment to strengthening economic ties with China, emphasizing the need for fair competition between French and Chinese companies. Macron’s remarks come as China continues its anti-dumping investigation into French Cognac and Armagnac, which was extended in March.

Macron expressed optimism about resolving the trade dispute, which has impacted major French spirits producers. The investigation’s progress is seen as a positive step for French exporters, who have faced challenges in accessing the lucrative Chinese market.

In addition to trade, Macron and Xi discussed broader geopolitical issues, including the war in Ukraine and preparations for the upcoming UN conference on the Arab-Israeli conflict. Macron highlighted the shared goal of achieving lasting peace in Ukraine and pledged to work with China on global diplomatic efforts.


Why It Matters?

Macron’s outreach to China underscores the importance of maintaining strong economic ties with Beijing, particularly as France seeks to protect its export-driven industries like luxury goods and spirits. Resolving the Cognac trade dispute would provide a significant boost to French producers, who rely heavily on Chinese demand.

The call also highlights France’s strategic approach to balancing economic cooperation with China while addressing broader geopolitical challenges, such as the war in Ukraine and Middle East peace efforts. Macron’s engagement with Xi reflects Europe’s nuanced stance on China, which combines economic pragmatism with calls for fair trade practices.

For French companies, progress on the Cognac investigation could signal improved market access and reduced trade barriers, benefiting key players in the luxury and spirits sectors.


What’s Next?

France and China are expected to continue discussions on resolving the Cognac trade dispute, with potential outcomes likely to impact French exporters and the broader EU-China trade relationship.

Macron’s collaboration with Xi on global issues, including Ukraine and the Arab-Israeli conflict, will be closely watched as France positions itself as a key diplomatic player in these negotiations.

Investors and industry stakeholders should monitor developments in the Cognac investigation and broader trade relations between France and China, as these could have significant implications for French exports and economic growth.

Source
Tags: China
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Lumida's website (referred to herein as the "Website") is limited to the dissemination of general information pertaining to its advisory services, together with access to additional investment-related information, publications, and links. Accordingly, the publication of the Website on the Internet should not be construed by any client and/or prospective client Lumida’s solicitation to effect, or attempt to effect transactions in securities, or the rendering of personalized investment advice for compensation, over the Internet.

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‍Lead Capture Forms: By submitting your contact information in the forms on this site, you are not obligated to invest in Lumida's product or services.
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