Bonded zone lifts wine imports

For every 10 bottles of wine Chinese consumers drink, three are imported. An increasing number of international wine producers choose to enter China's market through the country's bonded zones, according to fresh data from China Customs.

French wine producer Patrick Mast knows a thing or two about China's love affair with wines. His company sold 3,000 bottles of wine to China in 2003, and the number has gone up to 300,000 as of 2013. He's hoping to lift that number even more, by showcasing his wines at the weekend's expo in western China's Xi'an International Trade and Logistics Park.

"Consumption and imports have increased a lot over the past 10 years. And the second reason is Chinese people are more open to different wines," French wine exporter Patrick Mast said.

Like Patrick, Chinese importers are just as enthusiastic about bringing in international wines, as the country became the world's 5th largest wine-consuming country in 2011. Many importers choose to go through bonded zones to make transactions easier.

"Before there was a comprehensive bonded zone, we had to go to Tianjin or Dalian ports to transport our goods," Chinese importer Chen Ping said.

Bonded zones in inland regions now save importers custom clearance and transportation costs. When wines from other countries arrive here, they can stay in the warehouse. Trade within the bonded zone is exempt from value added tax and consumption tax. These wines don't become imports until they go out of the bonded zone and custom duties are added. That's when they finally meet consumers. Simpler custom procedures and shortened transportation can save importers up to 30 percent of the cost.

"Tax benefits from bonded zones not only apply to overseas businesses but also domestic wine traders and dealers," said Qiang Xiao'An, director of Xi'An Int'L Trade & Logistics Park Mgmt Commit.

Only 4% of China's wine imports came in through China's 15 bonded zones last year, but that number was the result of a 60-percent surge from previous year.