Distilled Spirits Council Statement on New U.S. Trade Agreements with Cambodia and Malaysia
We are encouraged by this positive development and urge the Administration to build on this progress by securing a return to zero-for-zero tariffs on distilled spirits across all markets, most notably with our key trading partners, including the European Union and the UK. Permanent tariff-free trade in our most critical markets is essential to ensuring the continued growth and vitality of the U.S. spirits industry.
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Background:
- On Oct. 26, Ambassador Greer announced that the administration reached Agreements on Reciprocal Trade with Malaysia and Cambodia and Frameworks for Agreements on Reciprocal Trade with Thailand and Vietnam.
- Under the agreements, Cambodia agreed to eliminate its 35% tariff on U.S. spirits immediately. Malaysia committed to eliminate its tariff on U.S. spirits over 9 years, eliminate its discriminatory tariff on distilled spirits, and conduct an independent impact assessment with a view to finalizing a definition for spirit-based ready-to-drink products by the end of 2028.
- Negotiations with Vietnam and Thailand will continue in an effort to secure Agreements on Reciprocal Trade.
- In 2024, U.S. spirits exports totaled $114,000 to Cambodia (ranked 109th), $3.7 million to Malaysia (52nd), $1.2 million to Vietnam (75th), and $3 million to Thailand (58th).
- In 2024, the overall spirits market size was $5.9 billion in Thailand (ranked 20th), $885 million in Vietnam (60th), $752 million in Malaysia (64th), and $312 million in Cambodia (99th).
