Market Growth of Imported Wine in China

Topics: Tariff, International trade, Free trade Pages: 3 (568 words) Published: November 28, 2012
Market Growth of Imported Wine in China
By Yuki Mabuchi

Brief Introduction
With rapid growth of Chinese GDP over the past few years, China is now the world's fastest growing wine consumption market and yet still has huge potential as a market growth. Since Wine drinking is considered a healthier alternative to spirits and somewhat trendy, red wine is particularly popular in China. However, 90% of the wine consumed in China is still produced locally, and it is marketed as low price wines. Therefore, it is impossible for imported wines to compete with Chinese wines on the price. Each imported wine company are challenged to find their differentiation and own marketing tools. Even though market percentage for imported wines is 10%, the prospects for continued growth are huge because of the rapid increase in wealth and increasing urbanization of the population. The main topic for my research is to analyze market growth of imported wines in China followed by Chinese WTO regulations. The research estimates the impact of market growth according to import tariff rate which declined to 14% since China joined WTO. In addition, all imported wines are subject to a range of additional taxes, duties or fees, such as liquor tax, education tax, value-added taxes and consumption taxes. These taxes, duties and fees are taken into account in the analysis which estimates the impact of a tariff reduction on the retail price of imported wines in China. The research will show statistic analysis of imported wine market from different countries different point of view. Furthermore, the research will concentrate to a specific country such as Australia and New Zealand. In the past five years, Australia has been gradually gaining market share of bottled wines from traditional market leaders including France, Italy and Spain. However, since a zero tariff has been applied to Australia’s neighbor country New Zealand, going forward with...
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