Trade of spirits: Four years of pain
In recent years, the UK, EU and US were involved in a damaging trade war that began over aircraft parts and culminated in affecting numerous different industries – not least the spirits sector.
For four long years, US whiskey was subject to punitive import tariffs in the UK and EU, and Scotch Whisky (as well as other products such as Irish whiskey, cognac and gin) experienced the same measures in the US.
But with the final trade tariff being lifted in July 2022, Chris Swonger, President and CEO of the Distilled Spirits Council of the United States (DISCUS), explains why these tariffs were so damaging and what can be done to ensure they’re not imposed again.
To what extent did the US spirits industry suffer from the tariff dispute?
A: Our industry had duty-free access to the EU and UK markets since , which resulted in considerable export growth that benefited producers, farmers, and logistics and transportation companies across the US, prior to the implementation of retaliatory duties on American whiskeys.
The levy caused a 20 percent decline in American whiskey exports to the EU, our top export destination, from $552 million to $440 million. In the same period, U.S. whiskey shipments to the United Kingdom, our second-biggest market, have dropped from $150 million to $88 million, a 42 percent decrease. During this time, US whiskey exports fell by 18% and overall US spirits fell by
Q: Who deserves the greatest recognition for bringing about the breakthrough?
A: Without the resolute backing of the Biden administration, especially Secretary of Agriculture Tom Vilsak, Secretary of Commerce Gina Raimondo, and Ambassador Katherine Tai, the retaliatory tariffs imposed by the EU and UK on American whiskeys would not have been lifted.
How significant a role did cooperation with comparable organizations in the UK and Europe play in this process?
A: Through mutual investment flows, bi-lateral commerce, and similar production methods, the spirits industries in the US, EU, and UK are intricately linked. To emphasize the unanticipated negative effects of the tariffs and to press the EU and UK to lift the retaliatory duties on American whiskeys, DISCUS collaborated closely with its equivalent trade associations in the EU and the UK.
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Q: With its competitive domestic market, how can American Whiskeys compete in the UK now that tariffs have been lifted?
A: The UK is a sophisticated market where consumers have a high appreciation and desire for American whiskey due to their comprehension of its unique taste character.
But we think the UK will still be a wonderful market for American whiskeys because of the country’s and London’s global leadership in cocktail culture, as well as the fact that Brits are becoming more and more interested in trying out new and unusual brands and flavors.In addition to restoring market share in the UK that was lost as a result of the tariffs, our collaboration with the US Department of Agriculture to advance US spirits exports through its Market Access Program has been essential to this success. Through this collaboration, DISCUS is assisting a public relations firm in London with its “Cheers! Spirits from the U.S.A. campaign.”
How can we make sure that this destructive trade conflict never happens again?
A: We value President Biden’s leadership and his resolve to mend the trade ties with the EU and the UK in order to save American jobs and industry. We are trying to assist reset and improve the vital transatlantic trade partnership now that the crushing tariffs have ceased. This collaboration is essential to hastening the industry’s recovery from the Covid epidemic, retaliatory tariffs, and mounting strain on international supply chains.