Distilled Spirits Council of the United States President & CEO Chris Swonger released the following statement hailing House passage of the United States-Mexico-Canada Agreement (USMCA) to replace the North American Free Trade Agreement (NAFTA):
“Today’s vote in the House to approve the USMCA is a critical step forward in efforts to secure a modern, rebalanced agreement with two of our largest export markets. We applaud President Trump for securing an agreement which supports high-paying jobs for Americans. The agreement provides certainty for producers and will be vital in building upon the sustained growth the spirits industry has seen since the elimination of tariffs under NAFTA. We urge the Senate to act swiftly to approve the agreement and send it to the president’s desk as soon as possible.”
Background:
The USMCA includes provisions to:
- Maintain duty-free trade in spirits;
- Preserve recognition for “Bourbon” and “Tennessee Whiskey;”
- Secure Mexico’s agreement to take steps to provide distinctive product recognition for “American Rye Whiskey,” a fast-growing category of American Whiskey;
- Reaffirm commitments concerning the internal sale and distribution of distilled spirits;
- And establish new best practices regarding labeling and certifications for beverage alcohol, which will help to facilitate trade in distilled spirits among the three countries.
The elimination of tariffs under NAFTA in 1995 boosted U.S. spirits exports to Canada by nearly 1,700 percent and to Mexico by approximately 1,500 percent. In 2018, U.S. spirits exports to Canada were valued at more than $234 million. Exports to Mexico in 2018 were valued at $61 million. In 2018, Canada ranked as the top export destination for U.S. spirits exports and Mexico ranked as the ninth largest.