The total value of wine imports to Hong Kong from around the world reached $370 million in 2008, a year-on-year increase of nearly 80 percent and Department of Commerce figures show that U.S. wine exports to Hong Kong rose by more than 500 percent year-on-year through February 2009. U.S. exports there reached $18 million in value in 2008, double what they were in 2007.

This phenomenal growth is attributed to the February 2008 decision by Hong Kong's Special Administrative Regional Government to abolish a duty on wine imports that previously stood at 40 percent.

"Hong Kong has been a top three export market for U.S. wines ever since," California Wine Institute regional director for emerging markets Eric Pope said.

Pope was speaking during an event held at the Culinary Institute of America in Napa Valley yesterday where John Tsang, Financial Secretary for Hong Kong's Regional Government came to promote Hong Kong as a wine market hub.

"We aim to be one of the world's great wine trade and distribution centers," Tsang said.
Tsang made the decision to waive the import duty last year. He said the decision to lift the duties and forego that revenue was made to promote trade and create related jobs in sales, storage and logistics.

Tsang said several local and U.S. entrepreneurs have set up offices in Hong Kong in the last year, companies such as Vinfolio, Vinx Asia, Grapes International and Zachy's.

He said his vision is to make Hong Kong the platform for getting wine into other regions and for promoting wine market growth throughout Asia. He said Hong Kong customs has teamed up with the industry and overseas enforcement agencies to exchange information on counterfeiting and claimed that no cases of counterfeit wine have been recorded in recent years. He also said an accreditation system for cellars to establish standards for storage is in the works, which would be a first for the industry.

Customs has tailored inspections so they can be conducted in temperature controlled facilities instead of at the point of entry. "Wines used to be on the tarmac for hours" Tsang said.

Hong Kong's trade development council organized the inaugural Hong Kong International Wine and Spirits Fair last year. The fair will be held again this November.

In the past year, Hong Kong hosted ten wine auctions, the first such sales in the city for more than a decade, including two by U.S. auction houses, one of which drew more than $8.2 million

At least one winery owner who heard Tsang's pitch was on the fence about whether Hong Kong makes sense as a market for her.  Many wineries are small, and haven't much wine to sell.

"For a small winery like ours, the issue is, 'where's the margins?'" the owner of one Napa Winery said.

Most appeared quite enthusiastic about the potential opportunity, including Frank Gayaldo, a director of international business development for Lodi's Chamber of Commerce, himself a wine grape grower, who emphatically declared, "This is a big deal."

Ceja Vineyards president Amelia Ceja said she had just returned from Hong Kong. "There's plenty of room in Hong Kong for beautifully balanced wines from Napa Valley because there is already such a food scene,"she said.

There are 12,000 restaurants in Hong Kong.

The Michelin Guide includes more than 200 restaurants and 22 have earned coveted Michelin stars.

If Hong Kong wants to do the heavy lifting," said Eileen Fredrickson of wine industry consulting firm Gomberg Fredrikson & Associates, "God love them for it."