Hong Kong is one of the first stops for global wine companies looking to expand into the Asian market, industry insiders said at the opening day of the 16th Hong Kong International Wine and Spirits Fair on Thursday; but regarding the city’s latest move to develop a high-end liquor trade through tax reductions, some insiders said they have mixed feelings about it. The three-day event features over 600 exhibitors from 20 countries and regions.

Peter Clancy, CEO and founder of Ireland wine estate Lough Ree Distillery, said it’s the first time that his company has joined the annual exhibition: “We are here to find more distribution partners, including importers and wholesalers in Hong Kong, the Chinese mainland, and other nearby markets,” he said.

He added that on the first morning of the event, he established connections with six potential partners from across Asia — including China, Vietnam, Indonesia and Japan — as well as from the United Kingdom. “It’s still too early to say, but I believe attending the exhibition is good.”

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This is also the first time that Italian company Casalvento has participated in the fair. Exporter Manager Alessandra Bogliacino said that, as a new player in the Asia market, the company is eager to meet more distributors through Hong Kong’s platform.

“Hong Kong is my second stop in Asia; I was in Tokyo two weeks ago and will head to Bangkok next,” she said.

But another Italian wine merchant, Tenuta Biodinamica Mara, has participated 10 times in the fair and has established a presence in both the Hong Kong and Chinese mainland markets. General Export Manager Davide Marino said, “A Hong Kong importer suggested we join the exhibition this year, as it’s a good period (considering) the economies of Hong Kong and the mainland have restarted.”

In the latest Policy Address released in mid-October, the Hong Kong government announced it would reduce duties on high-end spirits. For liquor with an import price over HK$200 ($26), the tax rate has been lowered from 100 percent to 10 percent for any quantity above HK$200, while spirits priced at or below HK$200 will continue to be taxed at 100 percent. Industry insiders said they have mixed feelings about this move.

“It’s a good news for us, because when the tax is coming down, customers will be encouraged to buy more,” said Clancy, adding that some of his company’s products are eligible for the duty cut.

Cheng Sze-man, a consultant at Everrise Tobacco, a company that distributes baijiu — a Chinese spirit — in the Asia-Pacific region, expressed cautious optimism about the reduced duties. “Baijiu is expected to benefit from this move,” Cheng said, adding that she was concerned that suppliers might hike prices in response to the tax cut.

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Although baijiu has a relatively small share of the Hong Kong market compared to wine, increased economic and trade exchanges with the mainland have introduced more Hong Kong people to baijiu culture, said John Lee, a director of Everrise International Trading. “The recognition of baijiu in Hong Kong has grown.”

Marino suggested that for Hong Kong to establish itself as a trading hub for wines and spirits, more marketing efforts are needed — not just in Asia, but also in key wine-producing regions of Europe.

The fair mainly targets industry insiders, but a dedicated area — Wine Fiesta — will open its doors to the public on Saturday.

Contact the writer at irisli@chinadailyhk.com