The Scotch Whisky Association (SWA) on Tuesday welcomed a World Trade Organization (WTO) ruling that gives the European Union the right to impose tariffs on $4 billion of US goods in retaliation for subsidies granted to Boeing.

Negotiators said the ruling could hasten discussions to resolve the 16-year legal battle over subsidies to aircraft manufacturers Boeing and Airbus.

The European Commission said it would not impose duties if the US withdrew its tariffs on European goods such as wine and whisky.

Scotch exports to the US are down 30% since the tariffs came into effect, amounting to over £200 million in lost exports.

The SWA said “losses are mounting and the situation is threatening businesses and jobs …”

The Scotch Whisky industry employs 11,000 people in Scotland and its supply chain supports 40,000 jobs throughout the UK. 

Scotch is worth over £5.5 billion to the UK economy.

Tuesday’s WTO decision follows its ruling last year allowing the US to impose tariffs on $7.5 billion of EU goods over state support for Airbus, which has sites in the UK, Germany, France and Spain.

A spokesperson for the SWA said: “We welcome the publication of the World Trade Organisation’s decision on the countermeasures the EU can impose in respect of US subsidies to Boeing as a necessary, final step in the Airbus/Boeing litigation. 

“We continue to urge all parties to the dispute to act quickly now to settle it, and remove tariffs on Scotch Whisky and other unrelated products.  

“These are doing significant damage to our industry. 

“Our losses are mounting and the situation is threatening businesses and jobs, just when the focus should be on the COVID recovery.”

European Commission executive vice president Valdis Dombrovskis said the ruling will allow the EU to impose tariffs on US goods but he added: “I would much prefer not to do so — additional duties are not in the economic interest of either side, particularly as we strive to recover from the COVID-19 recession … 

“It is my hope that the US will now drop the tariffs imposed on EU exports last year.

“This would generate positive momentum both economically and politically, and help us to find common ground in other key areas.”