Scotch whisky: US tariffs

Kenny MacAskill Excerpts

Thursday 30th January 2020 Westminster Hall

[Kenny MacAskill (East Lothian) (SNP)]

I thank the right hon. Member for Dumfriesshire, Clydesdale and Tweeddale (David Mundell) for securing the debate. As he well knows, Scotch whisky is synonymous with the Scottish nation and is vital to the UK Treasury, and tariffs do matter. It is not the case that only some distilleries are already feeling the pain, as other Members have mentioned. It is quite clear that it could be a difficult challenge for the entire sector.

I am reminded of going to meet one of the industry’s chief executives—I think she was from Grant’s, in the Minister’s own constituency—many years ago. The tale she told about tariffs is apposite to what we are discussing today. She explained that, historically, Scottish and Irish whisky exports were at par—they were level pegging until world war two. There was a global lack of whisky following world war two, and the Irish Government, under a particular Taoiseach, decided to try to protect the home market in order to curry favour, as there was an impending election. The consequence was that Scotch whisky took off and Irish whiskey slumped. The tariffs that were imposed on Irish whiskey have meant that it has never been able to match Scotch whisky and will never catch up, so the historical record shows that tariffs can be extremely harmful. Given that I heard that from the chief executive of Grant’s, I am sure the Minister will take cognisance of it.

As colleagues including my hon. Friend the Member for North Ayrshire and Arran (Patricia Gibson) said, we face particular risks. Obviously, the backdrop is the dispute between the EU and the USA over Airbus, but Brexit is in danger of hindering, not helping, the position. We will lose the support of the world’s largest trading bloc; in return, we are seeking to curry favour and obtain a special deal and a special relationship with the United States of America, which is imposing tariffs. What reason do we have to believe that we will be treated any better on a trade deal that we are on this issue?

We should not be fooled about the supposed special relationship between the UK and the USA: it is mythological. As we have seen recently with Huawei and other things, President Trump wants what is best as he sees it for the United States of America, irrespective of the supposed close relationship between the nations. Anybody looking for evidence of that should look at the relationship between Canada and the United States. If any nation should have a close and special relationship with the United States of America, it is Canada, given that they share a continent and a land border. Yet, not on whisky tariffs but agricultural tariffs, President Trump’s behaviour towards Prime Minister Trudeau was reprehensible, bullying and haranguing—frankly, it was disgraceful. Why would he treat the United Kingdom any better that the 40 million or 45 million people who share the continent of North America with the United States?

We are deluded if we think that somehow or other, because the Prime Minister has this supposed special relationship with President Trump, we will get anything beneficial. The real risk, as my colleagues said, is that we not only face the challenges of tariffs—we must learn from history about the dangers that can come about, as the Irish whiskey sector testifies to—but additional challenges. It is quite clear that, in the United States, there are those who do not just want a tariff imposed on Scotch whisky but wish to have their product masquerade as Scotch whisky. We face the problem of US imports undermining the brand that we have to protect.

We have enough difficulties with tariffs; we cannot face the challenges of protecting the brand of Scotch whisky. On that basis, the Minister can rest assured that the Scottish National party will give the Government our full support, but the Government are obligated to protect this national resource for Scotland, which is vital to the UK Treasury.