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How Brexit Affects the Whisky Industry

Brexit 062716 The UK’s vote to leave the EU has left many industries like whisky unhappy about the referendum.  The benefits of EU membership revolve around the free trade agreements already set in place for Scotch whisky.  Such deals with Asian countries like Vietnam and South Korea come to mind where the tariffs on the spirit have been decreased to zero.  With access to the European market also limited, the UK’s whisky industry should expect future difficulties in growing outside of their boarders.  Despite this, it is interesting to note that Credit Suisse issued a statement proclaiming that companies like Diageo and Pernod Ricard could experience a “significant currency benefit” that could “more than offset the potential underlying business risks.”  Credit Suisse is predicting that both companies’ earnings per share will increase due to a weaker sterling.  Only time will tell.

Source: The Wall Street Journal