Borders businesses could be hit with “devastating” tariffs in US-EU trade dispute

A number of key businesses in the Scottish Borders are set to be hit with significant duties as a result of a trade dispute between the US and EU.

The US has announced that from 18th October it intends to put a 25% duty on a number of imports from the European Union in response to a long running dispute over EU subsidies to aircraft maker Airbus.

A number of businesses in the Borders will be subject to this duty, including whisky produced at the Borders Distillery and textile firms.

The US is Scotland’s most important export market for whisky, with over £344m of exports going to the country each year. The Scotch Whisky Association has said the tariffs will “undoubtedly damage” the sector, and “disproportionately impact smaller producers” like the Borders distillery.

Meanwhile, leading textile firm Hawico has described the news as “devastating” saying it could end exports to the US, which account for around 20% of total exports for the firm.

Local MP John Lamont has said the news could be crippling for some sectors in the Borders. He has made representations to UK Government Ministers to urge them to work hard to negotiate a settlement between the EU and the US and if they are imposed, to consider covering this extra duty to protect local businesses.

John Lamont MP said: “It is completely unfair for businesses in the Borders to be caught in the middle of what is essentially a disagreement between the EU and the US about aircraft. Unfortunately, what has happened is the EU was found to have broken the law in 2004 and the US has been allowed to impose these tariffs in response.

“For both whisky and textiles to be hit with a 25% tariff for one of our largest markets could be crippling, will inevitably harm economic growth and could cost jobs.

“Like a number of other colleagues, I’ve strongly urged Ministers to do all they can to protect Scottish businesses and will continue to raise this issue over the coming days.

“The UK Government needs to use every available avenue to broker an agreement between the US and the EU to try to bring an end to this dispute. If this devastating tariff regime goes ahead, the Government needs to look at covering these tariffs to protect local Borders businesses.”

Karen Betts, Chief Executive of the Scotch Whisky Association said: “The tariff will undoubtedly damage the Scotch Whisky sector. The US is our largest and most valuable single market, and over £1 billion of Scotch Whisky was exported there last year. We are also concerned that it will disproportionately impact smaller producers. 

"We believe it is imperative that the EU and US now take urgent action to de-escalate the trade disputes that have given rise to these tariffs, to ensure that these latest tariffs are not implemented on 18 October.”