UK businesses should follow whisky’s lead in targeting Latin America, conference told
A rapidly expanding and young middle class in Latin America makes it an ideal target market for many UK businesses, an Edinburgh conference was told this week.
The event, hosted by the Scotch Whisky Association in association with Canning House, a leading UK forum on Latin American politics, economics and business, was held to highlight the benefits of trade with the region.
Latin America is already a significant market for Scotch, accounting for some £460 million in exports, or around 17% of the industry’s total foreign sales.
Around a third of all Scottish exports to Latin America comprise of Scottish whisky.
Rob Capurro, chief executive of Canning House, said: “If you total up all of the middle class in Latin America, there are more than in India and China combined.”
David Frost, Scotch Whisky Association chief executive, said: “Latin America is a big and growing market. That’s why we took the lead in making the first Canning House event in Scotland happen.”
Speaking at a panel session, Peter Smith, Diageo industry affairs director, noted that the market for Scotch in Latin America went back decades.
Diageo’s company archives included orders from early last century, he said.
But Scotch faced significant competitive barriers in the region, he added, including unfair tariffs and customs duties.
Lower tax rates in Colombia for spirits at 35% abv or less give domestic producers an unfair competitive advantage, the SWA believes.
Scottish whisky must be at least 40% abv by law.
Provincial distribution monopolies within Colombia also distort the market by favouring domestic distillers, it says.
The SWA regards Colombia as a key target market with significant potential.
Exports of Scottish whisky to Colombia hit £24 million 2014, up 7% year on year.