Arnault says he hopes tensions with China on luxury quiet down

Billionaire Bernard Arnault said he hopes a planned visit to France next month by China’s Xi Jinping will help smooth trade relations between Paris and Beijing.

“I hope the economic tensions will quiet down and that we can continue a solid economic collaboration with China,” Arnault, the chief executive officer of LVMH Moet Hennessy Louis Vuitton SE, told reporters after Thursday’s annual general meeting in Paris.

The comments follow China’s decision to launch a probe into alleged dumping practices by Cognac makers from the European Union. In January, LVMH, the owner of Hennessy Cognac, said it was working with the country on that probe. 

That move by China came after France was the main backer of an investigation the EU opened last year into Chinese electric vehicle subsidies.

Bloomberg News also reported last year that European cosmetics makers were alarmed over Chinese demands regarding their trade secrets. LVMH owns perfume and makeup brands such as Christian Dior, Guerlain and Fenty Beauty by Rihanna.

Arnault’s hopes for a quick resolution to the trade spats may be disappointed, as the EU is considering several new investigations into China. The bloc is looking into whether Beijing provided illegal support for windparks on the continent, has brought subsidy probes into solar and railway firms, and will shortly launch an inquiry into China’s procurement of medical devices.

Arnault, the world’s wealthiest person, said he believes China will manage to reboot its economy amid soft consumer demand.

Earlier this week, LVMH said first quarter organic revenue fell 6% in Asia, excluding Japan, a region which contributes a third of total revenue for the group.