Global sales of Scotch whisky may have recently gone through the GBP1bn barrier but, writes Chris Losh, worries over declining volumes in major markets such as France and Spain have resulted in cautious and qualified celebrations of this milestone.

Any drink whose global sales have recently broken the GBP1bn barrier has good reason to feel pleased with itself. But there's more than traditional Scottish caution behind why Scotch distillers are leaving the Champagne on ice for now.

The latest figures from the Scotch Whisky Association, released this week, are both a pleasant surprise and a warning. On the plus side, global growth of 3% by value took the category to its highest sales level since 1997. On the downside, two of the category's biggest markets are showing worrying signs of decline.

France was down 4% by value, and while this is not part of a long-term trend, the drink seems to have stalled in its biggest volume market, and with stringent anti drink-driving laws hurting the entire after-dinner sector in France, may well take some kick-starting again. Greece, too, is in trouble.

Most serious, though, is Spain, where a flat market would be progress. Instead, since problems with overstocking at the start of the millennium, Scotch has seen a definite downward movement in sales. Should the latest fall, of 16% by value, be repeated for the next series of half-yearlies then people will be talking, with some justification, of a crisis in the drink's flagship market.

Some of Scotch's problems stem from the growing fashionability of dark rum and some from changing social trends. With an ageing population, there is a definite move in Spain away from drinking in bars and to sipping at home. Less but better might be good news for premium blends, but it's bad news for overall volumes.

So, with Scotch already taking arms against a sea of troubles, this wasn't a great time for the Spanish government to up its duty on spirits. If the 2% rise in January was a shot across the bows, the subsequent 10% increase in September was a full-on broadside, and one which practically guarantees that spirits generally, and Scotch in particular, will be facing a painful short- and possibly medium- and long-term future.

So, how come the positive sales figures?

Well, booming sales in 10 ten new members of the EU will have helped, of course. But a double-digit rise in a market like Poland won't even begin to make up for a 4% drop in a market like France. No, the reason for the current cheery figures is mostly the US and Asia, where China (since its WTO accession), Taiwan, South Korea and Thailand all rediscovered their vigour.

The trouble with the markets of the Far East, though, is their volatility, as anyone who put their kilt on the Japanese market would doubtless attest. China, of course, will keep growing, though even with its impressive two- and three-figure growth of the last few years it remains only a fifth of the size of both France and Spain.

But the huge South Korean market is highly febrile by nature. Only a year ago, Scotch was in free-fall as a government-implemented credit squeeze put the bite on ostentatious purchases, so while an upturn there is to be welcomed, it needs to be treated with caution.

Which is why although these latest positive figures are welcome, they also have a certain air of fragility to them, hence the sound of backs being patted, rather than corks being popped.

I could be wrong, but I suspect most brand owners would swap double-digit growth in the Far East for a sustainable, single-digit return to form in France, Greece and Spain.