Diageo shares rose in early trading on Friday after former US President Donald Trump announced the removal of tariffs on Scotch whisky, citing the visit of King Charles and Queen Camilla to the United States.
Market Reaction
Shares in the drinks giant climbed by 2% above £15 in London, making it the top gainer on the FTSE 100. Diageo, which produces brands such as Guinness and a wide range of Scotch whiskies, benefited directly from the tariff relief.
Trump's Announcement
In a social media post late Thursday, Trump stated: "In Honor of the King and Queen of the United Kingdom, who have just left the White House, soon headed back to their wonderful Country, I will be removing the Tariffs and Restrictions on Whiskey having to do with Scotland’s ability to work with the Commonwealth of Kentucky on Whiskey and Bourbon. The King and Queen got me to do something nobody else was able to do, without hardly even asking!"
Whisky and most other UK exports had been subject to 10% tariffs under Trump's trade policy. The removal applies specifically to Scotch whisky, a key export for the UK.
Impact on Diageo
Diageo's whisky portfolio includes iconic brands such as Johnnie Walker, Lagavulin, Talisker, the Singleton, and Mortlach. The tariff elimination is expected to boost sales and profitability for the company, which has faced headwinds from trade tensions.
The move marks a significant diplomatic gesture during the royal visit, with Trump crediting the King and Queen for the change. Industry analysts noted that the tariff removal could strengthen UK-US trade relations and benefit the broader Scotch whisky industry.
