Us Tariffs: Scotch Whisky

Part of the debate – in the House of Commons at 5:19 pm on 7th October 2019.

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Photo of Barry Gardiner Barry Gardiner Shadow Minister (Department for Business, Energy and Industrial Strategy) (Energy and Climate Change), Shadow Secretary of State for International Trade 5:19 pm, 7th October 2019

I welcome the urgent question asked by David Mundell. I welcome, too, the measured tone of the Minister’s response, the factual information that he provided at the Dispatch Box and his support for the international rules-based order.

It is no secret that the American President has sought to define his Administration as one of trade warfare, seeking to put the interests of America first and to repatriate jobs and industry to the USA. He believes that a trade war is one that the US can win. Does the Minister agree that no one wins in a trade war? That much is clear from the spurious Boeing case against the importation of C Series aircraft and the use of section 232 national security measures to prevent steel and aluminium exports to the US, and now again in respect of automotive imports.

The concern for British exporters is that the recent findings of the WTO in relation to aircraft subsidies will be used to secure an advantage for American producers and for American interests in any future trade agreement between our nations. The US trade representative has been clear that the US will impose countermeasures in the first instance and will seek to discuss how to resolve this dispute with the EU thereafter

“in a way that will benefit American workers”.

Other European leaders have been clear in their condemnation of the measures, but our Government have been decidedly more reserved, perhaps for fear of jeopardising any future trade talks. I note in the Government’s response published last week that the UK was seeking clarification from the WTO that the UK was compliant with measures regarding subsidies to Airbus, so I ask the Minister when he expects that such confirmation will be given and whether this indicates a divergence from the EU response.

Many products that these tariffs are being imposed on are subject to geographical indications, which are awarded under trade agreements to protect products of cultural heritage. It is no surprise that these products have been targeted first, as American producers of rival products have made no secret of their desire to destroy such protections. Does the Minister agree that this is not just about responding to the subsidies ruling, but about undermining and eliminating competition in favour of US producers who have long sought to do away with product labelling requirements, restrictive geographical indicators, and even sanitary and phytosanitary standards? Does he agree that going after some of our most iconic products is part of that strategy?

The Scotch whisky exports from this country amount to £6 billion a year—21% of all our food and drink exports, and 41 bottles a second. That is faster than I can drink it! Scotch whisky is so important to our exports. In fact, I think it is our third largest export, so the Government need to do all they can to protect it. These measures come at a time when the UK Prime Minister still insists that we could have a no-deal Brexit in a matter of days—a scenario under which substantial tariffs could be imposed on our exports to the EU. That would be a double whammy for British producers.

The impact of these tariffs on our biggest markets would be enormous, particularly for products such as Scotch whisky. No amount of new trade agreements overseas could mitigate that imminent threat. The EU is understood to be exploring what position to take in respect of these new tariffs. What role will the Minister’s officials be taking in those discussions, given our pending withdrawal?