Mainland China's first investment fund capitalise on Hong Kong's wine trade

Hong Kong has capitalised on the rapid expansion of personal wealth in China to become the dynamic centre of Asia's wine trade since it abolished duties on wine imports in 2008.

Wine imports are poised to set a new record after surging nearly 60 percent year-on-year in the first nine months of 2011 to US$940 million. The figure stood at $895 million in 2010, up 73 percent from $517 million in 2009.

The wine industry council in the French region of Bordeaux says local producers saw a 92 percent surge in export volumes to China in the 12 months to July, and a 69 percent increase to Hong Kong.

To capitalise on this, businesswoman Ling Zhijun has just launched Dinghong, mainland China's first investment fund specialising only in wine -- available only to those with one million yuan ($160,000) or more at their disposal.

She is waiting for the green light from authorities to start raising money, but says she already has investment pledges from a dozen people and will be able to collect 200 million yuan by the end of the year.

"We're banking on a return on investment of 15 percent a year," she said, adding she chose to focus only on French wines because those from the New World are "more standardised, a bit like Starbucks coffee".