Europe and US press Japan on spirits market

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The Independent Online
The European Union and the US turned up the heat on Japan yesterday in their bid to open up its lucrative spirits market. As part of an agreement forged at the World Trade Organisation meeting in Singapore, the two sides plan to accelerate the elimination of tariffs on exports of European whisky and gin.

Although the figures involved are relatively small - the elimination of tariffs will save European producers only about $35m (pounds 22m) a year - the move has been seen as a symbolic gesture to countries with whom the EU and US are currently negotiating tariff reductions.

Murray Loake, a spokesman for Guinness, which exports Johnnie Walker whisky as well as Gordon's and Tanqueray gin, said: "Although the current tariffs are not as high as we see elsewhere in the world, this news can only help our competitive position." He said the move was aimed particularly at Japan, which discriminates against whisky and gin in favour of shochu, its home-grown spirit, but also other countries including Chile.

The agreement means tariffs on brown spirits - whisky, brandy and rum - will be eliminated by 2000, compared with a previous agreement to do so by 2004. It also includes white spirits such as gin and vodka for the fast time - those tariffs will be wiped out over five years.

Currently the US import tariff on cognac is about 50 cents a gallon and 20 cents a gallon for whisky. That works out at only a few cents a bottle so it would be wrong to overestimate the financial importance of the deal, Mr Loake said.

The deal is also being viewed as a quid pro quo for the agreement announced earlier in the week to wipe out tariffs on computer exports. That provides a big boost to US companies, while the liquor tariff agreement principally helps European companies. Only two of the world's 10 largest spirits companies are American - Brown Forman, which makes Jack Daniels whiskey and Southern Comfort, and American Brands, which produces Jim Beam bourbon.