China has agreed to reduce import tariffs on UK whiskies, including Scotch, following visit from the UK Prime Minister Keir Starmer to Beijing this week.
A statement today (30 January) from the Chinese Ministry of Finance said "a provisional import tariff rate of 5% will be applied to whisky" as of Monday (2 February).
A press release from the UK government said tariffs were being reduced on Scotch from 10% to 5%.
Just Drinks understands however a tariff reduction is being applied by China to all whiskies produced in the UK. It does not include other exports.
In its statement, the Government said it expected the deal to bring in £250m ($344.4m) to the UK economy in the next five years.
It added the move "will help Scottish distillers compete more effectively in one of the world’s fastest-growing consumer markets".
China was the tenth-largest market for Scotch whisky in value terms in 2024 according to the Scotch Whisky Association. Scotch exports to the country reached £161m in value that year, a 31.5% decline on 2023.
Compared to 2019 figures however, Scotch export sales have grown 81.4%, the SWA says.
Mark Kent, the SWA's chief executive, said: "China is a priority growth market for many Scotch whisky producers, which in recent decades has developed into a knowledgeable and premium focused market with a strong appreciation of Scotch. The proposed tariff reduction from 10% to 5% has the potential to re-energise exports of Scotch to this important market.
China was also the tenth largest market for Scotch in 2024 in terms of volumes. That year, it saw volumes dip 1.7% to 30 million bottles. Export volumes to China have risen 77.3% since 2019, according to SWA data.
Stephen Davies, the CEO of Welsh whisky group Penderyn Distillery, also reflected on the tariff agreement with China. "Penderyn has done a lot of business in China over the last few years although, over the last 12 months in particular, trading has been very difficult.
"We welcome any reductions in the cost of trading for our domestic or export markets, so from that point of view it's good news, although I believe it will take quite a while for the market for whiskies in China to improve and perhaps get back to the levels they were at maybe two years ago."
Just Drinks has also approached the English Whisky Guild for comment.
In May last year, the UK also signed a trade deal with India, cutting tariffs on whisky, gin and soft drinks entering the country. The agreement was signed by both parties in July.
The agreement sees whisky and gin tariffs halved to 75% from 150%, later falling to 40% by “year ten” of the deal, the UK’s Department of Business and Trade said in a statement at the time.
