The Distilled Spirits Council warned China’s just-imposed 25% tariffs – a response to U.S. tariffs on Chinese goods imposed earlier today – may damage the U.S. whiskey industry, which has benefitted from exports.
China’s entry into the World Trade Organization in 2001, which DSC strongly supported, resulted in a dramatic reduction in China’s tariffs on U.S. spirits, from 65% to 10% ad valorem. Last year, China further lowered its tariffs on whiskeys and brandies to 5% as part of a wider effort to lower tariffs on a range of consumer goods imports.
“Imposing 25% tariffs on U.S. whiskeys could put the brakes on an American export success story,” said Senior Vice President of International Trade Christine LoCascio. “American spirits exports to China have grown by almost 1,200%, from $959,000 in 2001 to $12.8 million in 2017.
“We hope the United States and China can soon resolve their differences so that U.S. whiskey exports to China will no longer be subject to the 25 percent tariff, which will harm Chinese consumers, its hospitality sector, U.S. whiskey exporters and the U.S. farmers that supply them.”
Total U.S. spirits imports to China in 2017 were valued at $12.8 million; of this $8.9 million was whiskey. The Council has conducted a U.S. spirits export promotion program, now featuring an American Whiskey ambassador, in China since 2007.
“Chinese consumers, like others around the globe, are clearly finding favor with the flavor, heritage and mixability of American Whiskey. It would be a shame to punish those consumers, along with the Chinese hospitality sector, as an unintended consequence of this trade dispute,” LoCascio concluded.