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Whisky maker Diageo toasts Britain's EU membership

Published 28/01/2016, 15:41
© Reuters. Whisky barrels are seen in the warehouse of the Diageo Cardhu distillery in Scotland
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By Martinne Geller

LONDON (Reuters) - Diageo (L:DGE), the world's largest maker of Scotch whisky, supports Britain staying in the European Union but its chief executive said he sees no dramatic immediate effect on its business from a possible "Brexit".

The maker of Johnnie Walker Scotch, Smirnoff vodka and Tanqueray gin was in favour of British membership because of easier trade within Europe and the rest of the world, Chief Executive Ivan Menezes told reporters on Thursday.

"We think it's very important for this country and for Scotch whisky," Menezes said, calling Scotch the "largest and most successful" food and drink export from Britain.

"Two thirds of our Scotch business goes to the emerging world and so we see the UK being part of the EU ... as important," the India-born CEO said following the release of the company's half-year financial results.

Several large British businesses have spoken out in favour of the EU, often citing the benefits of tariff-less trade. Many smaller firms have criticised the bloc for imposing what they argue are costly regulations.

Airline easyJet (L:EZJ) said this week it would campaign for Britain to stay in, with its chief executive telling consumers that membership encourages low cost travel between European cities.

After analysing various scenarios, Menezes said there would be no dramatic impact in the near term, if Britain votes to leave the EU, but that it could have an effect in the longer term.

"You're better off in free trade agreements if you've got more clout, and the EU brings more clout to the table," he said.

No matter what happens in a referendum that Prime Minister David Cameron hopes to hold this year on Britain's membership in the 28-nation bloc, Menezes said he's unlikely to move any offices or factories.

"I don't see us doing that," he said. "The thing about Scotch whisky is we're going to be in Scotland come what may."

© Reuters. Whisky barrels are seen in the warehouse of the Diageo Cardhu distillery in Scotland

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