Chivas chief hits out at minimum pricing move

City Editor

Friday 1 June 2012

CHRISTIAN Porta, chief executive of whisky company Chivas Brothers, has hit out at the Scottish Government for being "more about promoting headlines" than engaging with the drinks industry as the row over minimum pricing rolls on.

ANGER: Chivas Brothers boss Christian Porta said Holyrood was grabbing headlines with its policy. Picture: EPA

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TIM SHARP CITY EDITOR

Mr Porta believes minimum pricing, which will push the price of a bottle of 40% whisky up to a minimum of £14, is an "illegal" and "dangerous" policy.

He told The Herald: "We get the impression this Government is more about promoting headline grasping, and measures like minimum unit pricing which we do not believe is going to have an effect, than working with the industry."

Mr Porta's comments carry weight because Chivas Brothers is part of Pernod Ricard, the world's second largest spirits group, and has 15 distilleries and two bottling plants in Scotland. His comments also threatens to undermine Scottish Government efforts to position itself as a backer of the whisky industry as a key export industry.Mr Porta, who has run Chivas for the past eight years, sits on the ruling council of the Scotch Whisky Association, which, The Herald reported yesterday, is seeking to "marshal opposition" to minimum pricing in the European institutions.Mr Porta said: "We believe [minimum pricing] is going to be ineffective. It is not going to solve the problem of excessive consumption by a minority of the population. We believe it is illegal."With 93% of production exported, worth £4.23 billion in 2011, the industry says there is a risk other countries will seek to erect barriers to whisky imports under the guise of following Scotland's lead in health protection.Mr Porta: "It will give plenty of bad ideas to people in other countries."The Scottish Government for its part has argued that minimum pricing is legally justified on public health grounds. A spokeswoman said: "We have had continual dialogue with the alcohol industry on minimum pricing."We believe it to be the best way of tackling Scotland's unhealthy relationship with alcohol."We consider minimum pricing does comply with European law, provided it is justified on public health and social grounds."Mr Porta said Pernod has no objection to Scottish Government plans to lower the threshold for drink-driving.Pernod, he added, has "no opinion" on independence for Scotland. Asked if the prospect of the 2014 referendum is affecting Chivas's investment decisions, he said: "For the time being, no."In 2011, whisky production in Scotland bounced back to pre-financial crisis levels to some 354 million litres of pure alcohol.Chivas plans to boost its malt whisky spirit production by 25% to 60 million litres a year by expanding production at its Glentauchers, Tormore, Glenallichie and Longmorn distilleries and reopening Glen Keith where new equipment is being installed.Mr Porta is bullish about the prospects for the whisky industry and for Pernod brands such as Chivas Regal, Ballantine's and Royal Salute in emerging markets such as China and Latin America. He told The Herald that Africa is another potential whisky market if spirits giants can convert some existing beer drinkers."Africa is very largely untapped territory for Scotch whisky," he said. He identified Nigeria, Kenya, Morocco and Angola as possible targets. Mr Porta acknowledged there are global "economic risks" that could hamper the company's growth plans. However, he played down the chances of a meltdown in the eurozone."If Greece leaves the euro, which isn't necessarily the most likely scenario, there is a risk there is a contagion effect on Spain, Portugal, Italy," he said. "Is that the most likely scenario? No. Could it happen? Yes, it could."He said that Pernod has already significantly shrunk its operation in Greece. He added: "If Spain leaves the euro, which is a very, very unlikely scenario, what would happen? We have no idea."

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Chivas chief hits out at minimum pricing move

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