He is said to be as jaunty as a St. Patrick’s Day reveler, and Lady Gaga calls him her “longtime boyfriend who is always there when I need him.” A “smooth” operator, he is lifting Irish spirits and infusing some much-needed cheer into the world of the Celtic Tiger. The “he” of course is Irish whiskey. After having become nearly extinct in the 1960s, the brew has made a spirited recovery to now emerge as one of the fastest growing alcohol exports in the world.
With more and more Americans and Asians saying cheers to the sweet-flavored, smooth, brown spirit, its exports have jumped 60% over the past three years. In fact, the U.S. has been the biggest driver of this growth. According to recently released figures by the U.S. Distilled Spirits Council, Irish whiskey sales climbed 24% to 1.7 million nine-liter cases last year. In contrast, Scotch single-malt whisky sales increased around 9.5% to 1.4 million cases. Clearly, Irish whiskey is fighting a winning battle with Scotch on U.S. soil — a surefire shot of good news for the ailing Irish economy. Total Irish liquor exports amounted to $1.6 billion in 2010, according to the International Wine and Spirit Record.
Though all major Irish whiskey brands have been doing exceedingly well in the U.S. and Canada, Jameson (incidentally, Lady Gaga’s preferred brand) is the market leader and it has a massive 70% share of the Irish whiskey market in the U.S. Worldwide sales of Jameson crossed 3 million cases in 2010 and have been growing steadily ever since. In fact, Jameson is now the biggest international whiskey brand in Russia and South Africa and has a presence in nearly 120 other countries. Interestingly, the brand has been not only the prime beneficiary of the renewed interest in Irish whiskey but also the key growth driver for the spirit category. Jameson can take credit for fueling interest in all drinks Irish and the revival of other old Irish whiskey brands, all of which are rapidly barreling their way to American shores.
The recent resurgence in Irish whiskey exports is largely a result of the spirit’s taste and pricing. Irish whiskey’s smoother texture makes it much more appealing to the young and first-time consumers of hard liquor, who find the brown spirit more palatable than the heavier Scotch. More importantly, Irish whiskey’s competitive pricing has been easier on the wallet, especially given the difficult financial situation over the past three years. Also, as awareness about the texture, flavor, and history of spirits has grown, consumers in general have been looking to be more adventurous in their choices. So, many whiskey aficionados have embraced Irish brands.
The trend is a heady experience for the Irish not just because they believe their whiskey was long denied its place in the sun but also because Ireland now relies heavily on its exports to the rest of Europe and the U.S. to escape the gloom of its debt crisis. The roar of the Celtic Tiger, a moniker the country earned for its exponential growth a decade ago, has lately been more like a moan. Once revered as the fastest-growing nation in Europe, Ireland found itself enmeshed in huge debts, mostly due to a housing bubble and reckless borrowing. Not surprisingly, this left the country’s economy in shambles, forcing it to accept a harsh austerity regimen and a €67 billion bailout from the European Union and the IMF in 2010.
Consequently, disposable income among Irish consumers has been severely truncated as average weekly wages have fallen nearly 4.3% since 2008. Expectedly, this has all but destroyed Irish businesses that are buckling under the twin pressures of falling prices and reduced demand — precisely why the country is clutching hard at its export potential. The quarterly government data published in March 2012 illustrated how important exports have become for Ireland’s survival. At the end of 2011, the Irish economy slid back into recession — for the first time since 2009 — primarily due to slower-than-expected export growth.
The raging success of Irish whiskey worldwide is expected to help this struggling economy get back on its feet much like the way it has revived Gaelic pride in a drink with a glorious but chequered past. In the late 1800s, with more than 2,000 distilleries dotting the craggy Irish landscape, the country’s whiskey dominated worldwide sales. But catastrophe was just around the corner. The U.S. prohibition in 1919 sealed off a major market, and the U.K. imposed draconian tariffs on the product when the Irish freedom movement began soon after. Both events effectively kept the spirit away from half the world. The final nail in the Irish whiskey barrel was Ireland’s neutrality in World War II. As Ireland stayed aloof, American GIs were stationed in Scotland and other parts of Britain and they fell in love with Scotch whisky. Soon American popular culture embraced Irish whiskey’s bitter rival so tightly that “Scotch on the Rocks” became an anthem for every other Hollywood movie.
Little wonder then that the Irish feel it is poetic justice today when international pop stars like Lady Gaga sing fulsome praises of their light-bodied spirit, which they proudly call “Uisce beatha” or “water of life.” And for Ireland’s economy, it might well prove to be.
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