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Glass-half-full man who sees a positive future for Scotch

WHILE many voters signalled they were unhappy with the European Union in the recent elections to the European Parliament, David Frost thinks fondly about his time at the heart of the affairs of the organisation.

REAL REPUTATIONAL QUALITY: David Frost, the chief executive of the Scotch Whisky Association, is confident the boom in Scotch's popularity around the world will continue.
REAL REPUTATIONAL QUALITY: David Frost, the chief executive of the Scotch Whisky Association, is confident the boom in Scotch's popularity around the world will continue.

A former EU director in the Foreign Office, Mr Frost played a key role in negotiations that had a profound influence on the UK's relationship with the organisation, which is still felt today.

He was point man in the 2005 talks when then Prime Minister Tony Blair agreed to staged cuts in the UK's rebate from the contributions it makes to the EU budget.

Now the chief executive of the Scotch Whisky Association, Mr Frost notes the negotiations were reckoned to have been some of the most complex in the history of the EU.

"You've got so many moving parts, different member states all want their own needs, the overall need to keep the budget down, UK abatement and the politics of that all in it," recalls the Oxford history and languages graduate.

"Two or three of us led that negotiation and got us to a successful conclusion when nobody thought we would."

Mr Frost ranks Brussels, the centre of EU officialdom, top of a list of cities he lived in as a diplomat. This also includes New York and Paris.

"As a place to live Brussels is really under-rated ," says Mr Frost, who notes the city's suburbs feature great architecture, green fields and good places to go cycling.

An urban history buff, Mr Frost has been enjoying exploring Edinburgh since starting work at the association there in January.

Mr Frost reckons the secret of success as a diplomat lies in really getting to know the country one is based in and establishing a rapport with the people there.

"Nobody has to talk to you as an ambassador or a diplomat. If they don't like you they won't. So you've got to be good at really establishing that connection quickly and working out what makes people tick."

Mr Frost, who hails from Derbyshire, has been happily applying his skills in Scotland in a role that makes him an important ambassador for Scotch.

"We could not have a better product. It's got a real reputational quality around the world. Everyone has heard of Scotch whisky. We are very lucky to have that, being able to represent that is a fantastic privilege really."

Part of Mr Frost's job has involved getting to know people that run whisky firms operating across Scotland, including many based outside the country. He is glad to have joined the association at a time when whisky firms are capitalising on huge growth in the popularity of Scotch overseas.

Mr Frost is confident the boom will continue, driven by the increasing popularity of whisky drinking in emerging markets in areas like Asia.

"As more people move into the middle class in emerging markets the whole history suggests they turn to Scotch whisky as one of the symbols of that status."

He believes the fact firms in countries like France have been snapping up distilleries like Bruichladdich speaks volumes about the industry's global appeal.

A key part of the work done by the association involves lobbying overseas governments to take action against those that pass off local hooch as Scotch, for which Mr Frost's diplomatic experience comes in handy.

As the spokesman for an industry that can only make its products in Scotland but is subject to UK taxes and regulations, Mr Frost also has to work closely with the governments in Edinburgh and London.

"The broad picture is despite disagreements on particular issues we have a pretty collaborative, constructive relationship with both governments and long may that continue," he says.

Inevitably, a priority for Mr Frost in his new role has been establishing and articulating the industry's position on the independence debate, leading up to the referendum set for September 18.

He is adamant the question of whether or not Scotland should become independent is a matter for the electorate not the Scotch Whisky Association.

Within weeks of starting work at the association, however, Mr Frost made it clear he thought the industry benefited from the UK being part of the EU and from the support that the UK can provide in overseas markets.

In the association's annual review published last month Mr Frost noted uncertainty about what independence would mean for Scotland's currency and tax and regulatory regimes.

"We look for reassurance on how an independent Scotland could deliver a business, regulatory, and export environment at least as supportive as that which the industry currently enjoys," he wrote then.

Mr Frost says he has "absolutely not" had any objections from members since to what he wrote.

"We consulted very assiduously within the industry about what we said to make sure that we were really reflecting what the centre of gravity of opinion was and I personally spent a lot of my time on making that happen."

Mr Frost has been making the case for policy changes on both sides border.

He welcomed George Osborne's decision to freeze tax on Scotch and scrap the controversial duty escalator in the latest Budget but will be pushing for further concessions.

"We still think it's unfair that 80 per cent of the cost of the typical bottle of Scotch whisky is taxation, that's well above taxation that applies to other non-spirits categories and we're going to carry on saying that as long as we have to."

The association will continue to oppose the Scottish Government's attempt to impose a 50p per unit minimum price on alcohol, which it thinks will damage the industry. After reading widely on the subject, Mr Frost does not think minimum pricing will help tackle problem drinking.

The fate of the policy may be decided by the European Court, which is to consider whether minimum pricing is compatible with EU law.

Asked what more the Scottish Government could do, Mr Frost says: "Maybe a bit more clarity about the vision for the industry. It didn't figure very strongly in the White Paper (on independence)."

As firms are making huge investments in increasing capacity, Mr Frost is happy that some of the challenges the industry may need help to tackle are associated with its success.

"One of the things we're going to have to focus on ... is some of the issues connected with that (enlarged) footprint - infrastructure needs, skills needs and working with government to make sure we get those things. The road connections, port connections, people with the right skills to project-manage big engineering projects. Traditionally we as an association, as an industry haven't needed to focus on that but I think we are going to have to."

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