Business and union leaders in Britain have reacted angrily to the announcement of US tariffs on a range of European goods including Scotch whisky and stilton cheese after a World Trade Organisation ruling over subsidies for Airbus.
The US unveiled the list of goods to be hit with tariffs late on Wednesday after the WTO ruled that Washington could impose tariffs worth $7.5bn (£6.1bn) to remedy subsidies given to Airbus. The EU said it would retaliate.
Scotch and Irish whisky made in the UK will be subject to the tariffs but not whiskey from Ireland. The US spared cognac and champagne from the list but announced tariffs of 25% on goods including French wine, Italian and Dutch cheese and Spanish ham.
Gary Smith, the Scotland secretary of the GMB union, said the move represented a “troubling glimpse into the post-Brexit future” for the UK. “Scotland and the rest of the UK are sitting ducks after October 31st. The collective strength we have in the EU trading bloc will be gone and there is simply no such thing as a ‘special relationship’ with the United States – Trump will squeeze the UK economy for everything he can get,” he said.
Scotch whisky exports to the US were worth £1bn last year, , supporting a wider industry employing 11,000 people across Scotland. Karen Betts, the chief executive of the Scotch Whisky Association, said the tariffs would put jobs and investment at risk. “Despite the fact that this dispute is about aircraft subsidies, our sector has been hit hard.”
Airbus shares rose most on France’s CAC 40 index of leading companies, in a sign that investors had feared a stiffer sanction was possible.
Analysts said the tariffs may not be as bad as first feared for European drinks makers. Shares in Diageo, the owner of brands including Lagavulin and Baileys, rose by 1.9% on Thursday despite a fall in the FTSE 100 of about 0.6%. Shares in the French distillers Rémy Cointreau and Pernod Ricard also rose.
The US investment bank Jefferies said about $440m of revenue at Diageo would be affected by the tariffs, about 5% of its total US sales.
A spokesperson for the UK’s Department for International Trade said: “Resorting to tariffs is not in the interests of the UK, EU or US. The UK is working closely with the US, EU and European partners to support a negotiated settlement to the Airbus and Boeing disputes.”
EU goods affected by US tariffs
Planes, Irish and Scotch whiskies, jumpers, suits, coats, pyjamas, swimwear, blankets, bed linen, coffee, metal tools, axes and knives, biscuits, wine, meat (sausages, ham), cheese (stilton, cheddar, edam, gruyère, gouda, emmental, parmesan, reggiano, pecorino), butter, yoghurt, olive oil, mussels, cockles and clams, fruit (cherries, peaches, pears, oranges, lemons) and fruit juice.
