Scotch Whisky (Hansard, 27 November 1985)

§ 1. Mr. John Townend
asked the Secretary of State for Trade and Industry if he will make a statement on Her Majesty's Government's policy towards the European Community's report on discrimination by the Japanese Government against imported Scotch whisky.

§ The Minister for Trade (Mr. Paul Channon)
The Government welcome and are studying in detail the report published by the European Commission on exports to Japan of wines and liquor, including Scotch whisky. We are working in the Community towards a concerted strategy for resolving the difficulties still faced by those drinks in the Japanese market.

§ Mr. Townend
Does my right hon. Friend agree that that report confirms what many hon. Members on both sides of the House have been saying for some time—that the Japanese believe in free trade only for the Japanese? Is it not about time that we stopped pussyfooting around and said to the Japanese, "Remove discrimination against British products such as Scotch whisky and insurance within a specified time"—let us say six months. "If you do not, we shall take massive retaliatory action against your exports"? Have the Government not accepted the fact that it is no good talking politely to the Japanese, because they will merely bow and say, "Yes, in one or two years"? The only action they will appreciate is retaliatory action.

§ Mr. Channon
What my hon. Friend has said clearly strikes a chord in many parts of the House. We do not want to retaliate against Japanese exports to us. We want to get the Japanese to open up their market to us. That is what we should try to achieve, although we may not be able to. For once, my hon. Friend is slightly less than fair in what he says. A reduction in the tariff on Scotch whisky was included in the Japanese action programme in July. There has been some modest progress on that matter.

§ Mr. Wilson
Is the Minister aware that, due to the external ownership of the Scotch whisky industry, large quantities of malt have been exported to Japan for blending, thus preventing an opportunity for bottled Scotch to be sold there? Does he believe that it would now be appropriate to ask NEDO to undertake a sectoral inquiry into the future of the whisky industry, especially in view of the takeover bids which are currently in progress?

§ Mr. Channon
I shall draw the hon. Gentleman's suggestion on the latter point to the attention of my right hon. Friend, who is principally involved with the whisky industry, and I take note of what the hon. Gentleman says.

§ Sir Hector Monro
Will my right hon. Friend bear in mind that every restriction on the export of Scotch whisky has an impact on employment in Scotland, especially in the distilleries in the Highlands? Will he do everything that he can to try to resolve this matter as quickly as possible?

§ Mr. Channon
As my hon. Friend points out, the problem is not related only to Japan. We are trying to obtain better access for Scotch whisky in other markets in the world. We are having some success with some of them. I agree with my hon. Friend that it is extremely important that we should remove what barriers we can to the export of Scotch whisky, which is one of our most important exports. If we get a new round of trade talks going, our prime aim will be to bring down those barriers.

§ Mr. Dalyell
The Minister talks about trying. Have we not already been trying?

§ Mr. Channon
We have been trying. This Government are not the only Government who have been trying. The European Commission has recently returned from a visit to Japan. It is about to formulate proposals which will go to the December Foreign Affairs Council. The House will no doubt be interested to hear the results.