Scotch whiskey makers calmed down on Thursday after the United States agreed to suspend tariffs on one of Scotland’s main exporters after a long-running US-EU trade dispute over subsidizing Boeing and Airbus.
Former US President Donald Trump set a 25 percent tariff in October 2019 as part of a trade dispute over aerospace subsidies. Although the United Kingdom is no longer a member of the EU, it belonged to the bloc when it came to tariffs.
Earlier this week, the United States and the European Union agreed to end their dispute by paving the way for a five-year suspension of tariffs imposed by both sides on a number of products, including olive oil and cheese, as well as whiskey.
The Scotch Whiskey Association estimates that tariffs have contributed to a 30 per cent drop in total US exports, equivalent to around միլիոն 600 million ($ 850 million) in the 18 months to March 18, 2021.
“This deal eliminates the threat of re-registering tariffs on Scotch whiskey next month, allowing distillers to focus on export recovery in our largest, most valuable export market,” said Karen Bates, CEO of the Association.
The warming of US-EU relations was reliably expected after the election of US President Biden, who clearly stated his intention to improve ties. In March, both sides agreed to temporarily suspend tariffs related to the Airbus-Boeing dispute in the negotiation process.
Following the US-EU aerospace agreement, UK Secretary of State for International Trade Liz Truss and US Trade Representative Catherine Thai agreed to suspend reciprocal tariffs for five years.
“Today’s deal draws a line through an incredibly damaging problem. Does it mean we can focus on moving our trade with the United States to the next level, including closer efforts by countries like China to challenge unjust practices? The use of free trade to return?” better [coronavirus] “An epidemic,” Truss said.
Thai noted that the agreement, in which the two sides agreed to set up a working group in the civil aviation industry to work together against “non-market practices of third countries”, could be used to “ensure fair competition and meet common challenges”. China – other non-market economies. “
Following the UK’s exit from the EU economic trajectory earlier this year, it has been free to negotiate trade deals with any country it wants. Earlier this week, the UK government negotiated a broad free trade agreement with Australia that would eliminate tariffs on a wide range of goods in the coming years.
Ivan Menezes, CEO of beverage giant Diageo, said the abolition of Scotch whiskey tariffs and other recent developments show the benefits of Brexit.
“At the end of this dispute, a new free trade agreement with Australia, which eliminates the remaining tariffs on UK alcoholic beverages, and the opening of trade negotiations with India, the largest whiskey market in the world, and the UK’s newly independent trade policy are now benefiting greatly. For Scotland համար for Scotland, ”said Menezes, whose company has a single malt whiskey stall that includes Talisker և Laphroaig.
The Scottish National Party, led by the Scottish government, has called for more support from the UK government to help affected businesses.
“While this statement is very welcome after months of campaigning within the party, the scourge on Scotch whiskey exports has been staggering, and it will take time for the industry to recover,” said lawmaker David Linden.
According to an agreement on Thursday, the UK will cut tariffs on 25 percent of US rum and brandy vodka for five years. However, US whiskeys will continue to have a 25 percent tariff in the UK, set by the EU over the US-US steel-aluminum dispute.
The United States Spiritual Welfare Council welcomed the deal on Thursday, saying it hoped a decision could be made soon to cut tariffs on US whiskeys, which it said had boosted a 53 per cent drop in exports to the UK.
“We hope that this positive momentum will also lead to the rapid and permanent elimination of US whiskey tariffs on EU-UK tariffs,” said Chris Swinger, CEO of the group.
His colleague Karen Bates of the Scotch Whiskey Association said he hoped “these too can be resolved quickly”.