WASHINGTON, D.C./PARIS: Trade tensions between Washington and Paris flared after U.S. President Donald Trump linked steep new tariffs on French wine and champagne to France's participation in a proposed U.S.-led initiative aimed at resolving global conflicts.

Trump threatened to impose 200 percent tariffs on French wines and champagnes in what appeared to be an effort to pressure French President Emmanuel Macron into joining his so-called Board of Peace, an initiative that would begin by addressing the conflict in Gaza before expanding to other disputes.

The proposal has raised questions about how it would interact with the United Nations' role, and a source close to Macron said the French president intends to decline the invitation.

When asked about Macron's reported position, Trump dismissed the French leader.

"Did he say that? Well, nobody wants him because he will be out of office very soon."

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

Macron is due to attend the World Economic Forum in Davos before returning to Paris later the same day. Aides at the Elysee Palace have said there are no plans to extend his stay to January 21, when Trump is scheduled to arrive at the Swiss resort.

In another swipe at Macron, Trump published a private message from the French president in which Macron said he did not understand Trump's actions regarding Greenland. France is due to hold a presidential election in 2027 to replace Macron.

Wines and spirits exported from the European Union to the United States are currently subject to a 15 percent tariff. French producers have been lobbying to cut that rate to zero since Trump and European Commission President Ursula von der Leyen agreed on a U.S.–EU trade deal in Scotland last summer.

The United States is the largest export market for French wine and spirits, with shipments valued 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 group LVMH, which owns champagne producers including Moet & Chandon, fell two percent in early trading.

"These declarations by the President of the United States must be taken seriously but with composure," said Gabriel Picard, chairman of the French wine and spirits export lobby FEVS. The issue must be handled at a European level in a united and coordinated manner, the association said.

France's wine and spirits industry suffered a 20 percent to 25 percent hit to its U.S. business in the second half of last year following earlier tariff measures, Picard told Reuters on Monday, before Trump's latest threat.

An aide to Macron said the Elysee had taken note of Trump's remarks and stressed that using tariff threats to influence a third party's foreign policy was unacceptable.

European officials are separately weighing retaliatory measures, including up to 93 billion euros in tariffs and possible use of the bloc's Anti-Coercion Instrument, in response to Trump's separate threats of tariff hikes against European countries 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 TF1.

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

Trump has previously threatened 200 percent tariffs on EU wine and alcohol, including last March during an earlier bout of transatlantic trade tensions.

Governments have responded cautiously to Trump's proposal for a Board of Peace, which diplomats said could undermine the United Nations. A draft charter sent by the U.S. administration to around 60 countries calls for members to contribute US$1 billion in cash to retain membership beyond three years, according to a document seen by Reuters.