Caribbean rum to benefit from European tariffs on cheap products

Caribbean rum producers will continue to benefit from a tariff on low-priced products following the UK’s exit from the European Union on 31 December 2020.

In late May, the UK published its new Global Tariff containing the list of import duties that will be implemented once the UK leaves the EU and takes control of its own trade regime at the end of 2020.

Following a concerted effort by the Caribbean rum industry the UK has maintained the ‘Residual Tariff’ on rum which will protect Caribbean rum.

“Its maintenance goes some way to levelling the playing field for our producers,” said Komal Samaroo, chair of WIRSPA and Demerara Distillers. “We wish to extend our sincere gratitude both to our Caribbean governments and to the UK for this very positive result.”

According to WIRSPA, the protective tariff was put in place to protect Caribbean rum producers from low-priced products originating from countries which provide extensive subsidies to their local sugar and rum producers.

Prior to the establishment of the tariff, studies had indicated that more than 85% of the world production of alcohol was subsidised in one way or another.

According to Vaughn Renwick, WIRSPA CEO, while this is a very positive outcome for the industry, the road ahead is still uncertain.

“We do hope the UK and EU are able to agree to a trade arrangement that allows our products to move through Europe without additional red tape and costs,” added Renwick.

“Going forward, we also will continue to work with governments to ensure that this arrangement remains, and that limited protections are not traded away in future negotiations”.