spiritsNEWS December 2021

Trade in 2021: the silver lining of recovery

When looking back at 2021, we have clear reasons to feel hopeful. 2021 has been a much better year for EU trade exports of spirits than 2020. To be sure, COVID-related restrictions remain in place in many parts of the worlds, with some countries still deeply affected by the crisis and the related travel restrictions and closures in the hospitality sector. Nonetheless, we are starting to see a real improvement in conditions overall.

The figures available for EU exports until the end of August 2021 even suggest that this year might turn out to be slightly better than 2019, in great part due to a particularly positive performance in the US (+26.5% compared with Jan-Aug 2020, returning to Jan-Aug 2019 levels) and in China (+115.5% compared with Jan-Aug 2020 & +44% compared with Jan-Aug 2019). This is not only a reason to celebrate and rejoice for our sector, but for the entire EU economy, given the positive impact of EU exports on jobs and growth, including in rural communities supported by the enormously positive local footprint of our Geographical Indications producing communities.

For the US, we can see a clear upward trend after the painful tariffs we had been facing for a year and a half were finally suspended. If it was ever needed, this is clear proof that these tariffs were damaging our exports to what remains by far our most important export market. As we take time to ponder on the year that has gone by, we have clear reasons to rejoice when it comes to the transatlantic relationship. The doubling of tariffs for Bourbon & US whiskey, which would have negatively impacted companies with investment in both the US & Europe, as well as our hospitality partners, has been avoided – at least for now. Tariffs which were plaguing our industry in both directions have been lifted, at least for a few years, allowing us to start recovering from the COVID crisis. We now need these temporary suspensions to be converted into permanent removal, and for the transatlantic relationship to properly press the restart button and focus on strengthening our regulatory and trade connections.

Our good performance in other key markets, such as China, is another reason to celeberate as we sip our favourite cocktails by the fire, making the most of this festive season. In several markets, our products have grown in reputation, we have seen a premiumisation trend and have benefitted from the removal of trade barriers and restrictions or the avoidance of such barriers. We should not forget, however, that this positive trend remains fragile. Negative developments in the COVID crisis, geopolitical tensions & possible retaliation by third countries, or protectionist moves could all put this good performance and positive outlook for 2022 at risk.

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