CHINESE INVESTMENTS IN BORDEAUX HAVE COOLED EVENTUALLY
By Susan Lewis
Chinese investors are pouring much less money in Bordeaux vineyards partly due to the much tighter foreign exchange policy adopted by Beijing, according to a study published by a Bordeaux winery acquisition advisory company.
“We have gone from 20 to 5 transactions a year”, said Charles Traonouëz, a partner at the Bordeaux-based merger and acquisition advisory firm Medicis Partners.
Traonouëz has just published a study that lists 153 acquisitions by investors from China (including Hong Kong, Macao and Taiwan) since 1984, based on sales by the firm, press reviews and Laurence Lemaire's reference book ‘Le Vin, le rouge, la Chine’.
The study showed that after a peak of 35 purchases in 2013, investments have dropped since then, commensurately with the levelling off of Chinese wine imports, which fell sharply last year.
His study pointed out that since the Chinese government's tightening of foreign exchange controls at the end of 2017, it is more difficult for companies and wealthy citizens to take money out of the country for investment purposes.
He also believed that the growing popularity of whiskies as an asset class has also dented the attractive of Bordeaux vineyards.
“A break was needed,” said Traonouëz who also claimed that “Chinese investors remain as enthusiastic as ever, but they are pragmatic. If they find a more profitable asset, such as whisky, they switch. They often want to make money quickly, which wine does not allow them to do.”
(the writer can be contacted at: SusanLewis@thewinechronicle.com)
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