China threatens 25% tariff for Bourbon

11th April, 2018 by Amy Hopkins

Bourbon has been caught in the firing line of a simmering international trade war as China threatens retaliatory import tariffs for US-made products.

Bourbon

Bourbon could be hit by a 25% import tariff in China

Last week, China’s Ministry of Commerce said it is planning to respond to US president Donald Trump’s proposal to levy a 25% tariff on Chinese imports worth US$50 billion.

The Chinese government will challenge the US through the World Trade Organization (WTO) and is preparing retaliatory measures “of equal strength and scale”.

The Ministry of Commerce has proposed to increase tariffs on 106 products imported into China from the US, including Bourbon.

In a statement, a spokesperson for the department said: “The US, regardless of China’s solemn protest, has released the groundless proposed tariff list. This is a typical action of unilateralism and trade protectionism which China strongly condemns and opposes.

“The list released by the US has ignored the economic and trade cooperation with mutual benefit and win-win results which has been lasting for 40 years. It also disregards the voices of the industries in both countries and the interests of consumers and is against the national interests of the US, China and the global economy.”

In March, China announced plans to slap a 15% tariff on imports of American wine and modified ethanol.

That same month, the European Union secured a temporary stay on tariffs for steel and aluminium imported into the US, meaning that there is currently no retaliatory sanction from Brussels impacting American whiskey.

The White House announced a temporary exemption for the EU and six other countries – Argentina, Australia, Brazil, Canada, Mexico and South Korea – from tariffs of 25% for steel and 10% for aluminium, which came into effect on 23 March.

EU officials had previously suggested that retaliatory measures could affect agricultural products from the US, including American whiskey.

Eric Gregory, president of the Kentucky Distillers Association, previously said he is hopeful for a “long­-term solution” to the bubbling trade conflict.

“Bourbon is a thriving US$8.5bn industry in Kentucky, generating 17,500 jobs with an annual payroll of US$800m. Spirits production and consumption pours more than US$825m into federal, state and local tax coffers every year,” he said.

“We remain hopeful that a long-term solution can be found to avoid a costly trade war and protect our allies and partnerships around the world, which will continue to benefit spirits producers and consumers for years to come.”

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