First minister condemns US plans to set 25% tariffs on Scotch whisky

Plans for 25% trade tariffs on Scotch whisky exported to the US are “profoundly worrying” for the industry and “in no one’s interest”, First Minister Nicola Sturgeon has said.

The World Trade Organisation (WTO) has given the US the green light to impose tariffs on up to $7.5 billion (£6.1bn) of goods from the EU as retaliation for illegal subsidies the bloc gave to plane-maker Airbus.

It clears the way for the Donald Trump administration to impose counter-measures on the 28-member bloc and follows a WTO ruling in May 2018 on the Airbus subsidies.

During first minister’s questions at Holyrood yesterday, Ms Sturgeon said: “The news this morning is profoundly worrying for Scotch whisky and for the other Scottish products.

“I discussed the issue directly with the (Scotch Whisky Association) just a couple of weeks ago and we will continue to encourage the UK Government to support a negotiated settlement to this.

“We support the efforts of the EU to find that negotiated settlement.

“It is in no one’s interest to have trade wars like this – everyone ends up being a loser.”

The Scotch Whisky Association (SWA) has called on both parties in the argument to de-escalate their trade dispute.

Chief executive Karen Betts said: “The tariff will undoubtedly damage the Scotch whisky sector.

“We expect to see a negative impact on investment and job creation in Scotland, and longer-term impacts on productivity and growth across the industry and our supply chain.

“We believe the tariff will also have a cumulative impact on consumer choice.”

The Trump administration has announced plans to impose tariffs on EU cheeses, olives and whisky, as well as aircraft and aircraft parts.

However, Wednesday’s WTO decision may require fine-tuning of that list before it is formally signed off on October 18.

The Scotch whisky industry directly employs about 11,000 people in Scotland, and many more indirectly through its supply chain.

America is the industry’s single biggest market – with more than £1bn of the spirit exported last year.

HMRC data and SWA analysis shows the US market accounted for 22% of global value and 10.7% of global volumes of Scotch exports in 2018.

Meanwhile, the Scottish Greens said the Scottish Government should respond by suspending US military use of publicly-owned Prestwick Airport.

A Department for International Trade spokesman said: “The UK, through the EU, is seeking confirmation from the WTO that we have complied fully with WTO rulings regarding support to Airbus, and should not be subject to tariffs.”