Trade tensions

Ulrich Adam, Director General of spiritsEUROPE, explains why the EU-US trade spat was so damaging for the spirits industry, and outlines what needs to be done to reform global trade and prevent a similar episode from happening again.

June 2021 marked a sad anniversary in the EU-US trading relationship, and for transatlantic spirits trade in particular. Three years earlier, as part of a broader EU‑US dispute over steel and aluminium, a 25 percent import tariff for American Whiskey had come into force, a step followed by a fierce tit-for-tat tariff battle with multiple escalation and retaliation rounds between both trading blocs in the following 36 months.

A war of escalation

As 1 June approached, the spirits sector feared yet another dramatic escalation: on that day, the second tranche of EU rebalancing measures in the ongoing steel and aluminium dispute was due to begin, including a doubling of EU import tariffs for American whiskey to 50 percent. Such a step would have delivered a devastating blow to the sector, and could have reignited EU-US trade tensions on a broader scale once again.