Open

Coming up

Don't miss

Replay


LATEST SHOWS

MEDIAWATCH

Netanyahu deletes tweet featuring photo of James Foley

Read more

THE WORLD THIS WEEK

The World This Week - 22 August 2014 (part 2)

Read more

THE WORLD THIS WEEK

The World This Week - 22 August 2014

Read more

FRANCE IN FOCUS

FRANCE IN FOCUS

Read more

FOCUS

Lifting the veil over China's air pollution

Read more

ENCORE!

Tango Takeover in Paris

Read more

WEB NEWS

Calls for ISIS media blackout after execution of James Foley

Read more

IN THE PAPERS

'Steely resolve of reporters exploited by pared-down employers'

Read more

BUSINESS DAILY

US judge calls Argentina bond swap offer illegal

Read more

  • French teenage girls held over Syria jihad plans

    Read more

  • Good borders make good neighbours, Merkel tells Ukraine

    Read more

  • Iceland issues aviation alert on volcano activity

    Read more

  • France will not be 'be pushed around' by Germany

    Read more

  • Libya withdraws as Africa Cup of Nations host

    Read more

  • ‘European GPS’ satellites launched into wrong orbit

    Read more

  • Suicide bomber targets Iraq intelligence HQ in deadly attack

    Read more

  • Video: Israel bombs kidnapping suspect’s home

    Read more

  • US brands journalist’s beheading a ‘terrorist attack’

    Read more

  • Ebola prompts Philippines to recall UN troops in Liberia

    Read more

  • Besieged by problems, Hollande faces unhappy return from summer holidays

    Read more

  • US sued over ‘deportation mill’ in New Mexico

    Read more

  • Colombian army and FARC rebels in face-to-face talks

    Read more

  • US National Guard starts to pull out of embattled Ferguson

    Read more

  • PSG fall flat once more against Evian

    Read more

  • US job market yet to recover from recession, says Fed Chair

    Read more

  • August 22, 1914: The bloodiest day in French military history

    Read more

  • Fear of Ebola sky-high among Air France workers

    Read more

Business

When markets take the rap, wine goes pop

Text by Sébastien LE BELZIC , Henri MORTON

Latest update : 2009-03-03

As the financial crisis rumbles on, investors are on a constant lookout for safe havens, away from the world’s stock markets. Hong Kong’s investors are no exception, and the new investment of choice in the former British colony is fine wine.

“Take these bottles of Château Petrus, their price has increased seven-fold since we bought them,” our host Gregory De’eb, founder of Crown Wine Cellars tells us. His Hong Kong restaurant doubles as a private wine club housed in a former World War II bunker. The territory’s connoisseurs gather here to network, socialise and enjoy fine wine.

 

A South African diplomat in a former life, De’eb made his fortune in the wine business. His passion goes beyond money, but Hong Kong’s decision in February to remove all taxes on wine has certainly helped him keep his passion alive. Hong Kong has now become the cheapest place to buy wine in the world and French vineyards are reaping the rewards.

 

 

Gregory De’Eb, owner of the wine tasting club Crown Wine Cellars Limited

 

 

“Since the new tax rules have been instated there has been a change in drinking habits. People who used to drink a 50 euro Australian or South American wine still spend 50 euros, but now they go up a step in quality,” Eric Desgouttes, the French director of Watson’s Wine Cellar tells us.

 

And that step up in quality is what is helping French vineyards. Thirty percent of Hong Kong’s wine imports now come from France. In the seven months since taxes were eliminated, sales have increased 80%. Hong Kongers have taken a taste to these higher quality bottles.

 

Around one million cases of vintage wines are cellared on the territory, a quarter of the world’s total. They are stored in places like Gregory De’eb’s bunker come restaurant; a small percentage to be drunk, the rest left to gain years and value.

 

Wine is virtually a risk-free investment (unless you are clumsy enough to drop the bottle) and is all the more interesting in Hong Kong, the main gateway to the enormous Chinese market.

 

“The wines of the world pass through Hong Kong before moving on to China. They normally come from France or Spain, or are forwarded on from the UK, and they must usually pass through here before heading to the mainland.” explains De’eb.

 

By 2020, China is expected to be consuming half a billion bottles of wine a year – a massive increase from the paltry 20 million it drinks at the moment, and a massive opportunity for Hong Kong ‘s wine merchants. Others are also trying to get a piece of this lucrative market, with Macau’s government now contemplating a similar tax exemption on wine.

 

With exports of French wine to the United States falling 10 percent this year alone, China now appears to be the new Eldorado for French vineyards, as the global financial crisis is doing little to take the shine off Hong Kong’s wine glasses. Cheers!

 

Date created : 2008-10-21

COMMENT(S)