Korean tariff on spirits comes down

Korea’s 20% import tariff on spirits come down today (July 1) as a result of a free trade agreement (FTA) between the European Union and South Korea.

The Scotch Whisky Association has welcome the deal, calling it “ground breaking” and a “major milestone”. Korea is the sixth largest export market by value and ninth by volume for scotch worldwide.  Scotch is the UK’s largest export to Korea and direct shipments total £153 million (US$245.2m).

The FTA is believed to be the most ambitious trade deal negotiated by the EU and the first with an Asian country. Scotch whisky is the largest spirits category in Korea. The FTA provides legal protection in Korea for products with “geographical indications”.

SWA deputy director – Asia Pacific Martin Bell said: “Despite Korea already being a key market for scotch, its performance over the years has been impeded by the high tariff and other high tariff barriers in a market where the domestic spirits, soju, has a 97% market share.

“The FTA gives distillers a significant boost as they seek to market this products to Korean consumers who already has a taste for scotch whisky, notably premium blends,” said Bell.