A coalition of 20 industry bodies has called for the immediate removal of tariffs on EU and US products before the “once-booming transatlantic drinks trade” suffers further damage.
Trade associations including the Distilled Spirits Council of the US (Discus), Spirits Europe and the Scotch Whisky Association (SWA) have published a statement warning that further European Union (EU) tariffs of 25% on US rum, brandy, vodka and vermouth would “increase the tensions” around the ongoing trade war between the US and EU.
The trade war between the two nations stems from a 16-year dispute between aircraft manufacturers Airbus and Boeing. In 2004, the US took the EU to the World Trade Organization (WTO) over subsidies to European plane maker Airbus, and the EU retaliated with a case against the US over support for American manufacturer Boeing.
In addition to tariffs from the US, the spat has also seen the EU introduce tariffs on US goods, including American whiskey.
“The application of excessive and unwarranted tariffs has to end,” the coalition of trade bodies said in a statement.
“Hospitality businesses and our consumers, as well as producers, wholesalers and importers of distilled spirits, wine, and beer are being slammed from both sides of the Atlantic in an aircraft dispute wholly unrelated to the drinks business. This is on top of the closings of restaurants, bars, distilleries and winery tasting rooms because of the Covid-19 pandemic.”
The latest tariffs were authorised by the WTO last month. Under the new measures, the EU can impose almost US$4 billion in tariffs on US products in response to tariffs imposed by the US on US$7.5bn worth of EU goods, including single malt Scotch and single malt Irish whiskey.
The EU executive vice-president for an economy that works for people and commissioner for trade, Valdis Dombrovskis, said: “We have made clear all along that we want to settle this long-running issue. Regrettably, due to lack of progress with the US, we had no other choice but to impose these countermeasures.
“The EU is consequently exercising its legal rights under the WTO’s recent decision. We call on the US to agree to both sides dropping existing countermeasures with immediate effect, so we can quickly put this behind us.
“Removing these tariffs is a win-win for both sides, especially with the pandemic wreaking havoc on our economies. We now have an opportunity to reboot our transatlantic cooperation and work together towards our shared goals.”
Return to the negotiating table
As the new measures came into force yesterday (9 November), the coalition warned that the tariffs could force more businesses to close their doors and lay off more workers in sectors already severely weakened due to the coronavirus pandemic.
The statement continued: “The US and EU need to return to the negotiating table without delay.
“They need to immediately suspend the current tariffs as they negotiate an agreement to simultaneously eliminate additional tariffs on distilled spirits and wine in these disputes unrelated to the sector.”
The coalition of trade bodies include Discus, Spirits Europe, SWA, Comité Européen des Entreprises Vins, Wine Institute, American Beverage Licensees, Wine America, Wine & Spirits Wholesalers of America, National Retail Federation, American Craft Spirits Association, American Distilled Spirits Alliance, US Wine Trade Alliance, National Council of Chain Restaurants, Kentucky Distillers’ Association, National Restaurant Association, National Association of Beverage Importers, National Association of Wine Retailers, The Wine and Spirit Trade Association, Napa Valley Vintners, and Wine and Spirits Shippers Association.
Via The Spirits Business