- Posted by Newsdesk
- On 3rd May 2016
- Alibaba, china, digital bridge, Italy, Jack Ma, luxury, wine
Italian Prime Minister Matteo Renzi met with Alibaba executive chairman and founder Jack Ma at April 2016 Vinitaly international wine fair to announce a commercial partnership between the Chinese e-commerce giant and the Italian wine industry. Held in Verona, Italy, the 50th edition of the prestigious event was the first to be visited by a Chinese delegation.
A guest of the Prime Minister, billionaire internet pioneer Jack Ma used the opportunity to announce that he hoped to grow the share of Italian wines sold on his online platforms from 6% to 60%. Since the Italian wine industry largely consists of smaller, family-run wineries, has high tax duties and lacks a suitable national export strategy, the country’s exports have long underperformed in the rapidly-expanding Chinese market. Until now, French exports have benefitted from a better-organised domestic industry, whilst the market share of Australian wines has been boosted by the bilateral China-Australia Free Trade Agreement (ChAFTA).
Jack Ma told an audience at the event that he foresaw the internet providing a “digital bridge” between Italy’s 300,000 winemakers and China , which he hopes will become the world’s largest wine market. The Italian PM further added that Italy was ready to “bet on innovation” and considered the futures of both Alibaba and Italy to be “closely linked together” (China Daily). Prime Minister Renzi revealed that he hoped that Italian wine exports would reach a value of 7.5 billion Euros (USD 8.6 billion) by 2020.
In spite of the dominance of French wines in the Chinese market, the reputation of Italian imports is increasing, especially amongst younger consumers. According to Italian Wine Monitor Nomisma, 68% of young Chinese drinkers surveyed considered French and Italian wines to be of equal standing. The study also revealed that the future of Italian wines lies in the perception of its elegance and Quality.
As wine consumption has grown in China, a number of wealthy Chinese outbound tourists have taken the opportunity to go on wine-tasting tours in Europe. Not only do many wealthy Chinese look to purchase wines as an investment on such trips, but also buy up entire vineyards. In early 2016, Jack Ma acquired the historic Château de Sours winery in the Bordeaux region, where over 100 other Chinese investors have also purchased entire vineyards in recent years. Whilst this has until now been particularly the case in France, the increase in the prestige in Italian wines amongst the Chinese consumer class can only help spread this phenomenon to Italy.
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