E-Malt.com News article: Taiwan & China: Taiwan Beer produced in China not to be available in Taiwan

A Taiwan Tobacco & Liquor Corp. (TTL) executive has dismissed concerns of an opposition Democratic Progressive Party lawmaker that TTL's plan to produce Taiwan Beer in China could hurt it and Taiwan in the future, CNA reported on February, 24.

DPP Legislator Huang Wei-cher said he wanted to see the state-run company expand into overseas markets, but he was worried that its plan to contract a Chinese manufacturer to produce its beer in China would result in the leaking of the formula for Taiwan Beer and related production know-how.

"The beer produced in China could even make its way back into Taiwan," Huang said, fearful that the plan would undermine the state-run company's NT$26 billion in annual sales of the popular beer.

But TTL Senior Vice President Hang-liu Yu said the move was typical of how beer companies move into new markets – first by exporting, then working with a local producer and then setting up their own plant.

The company began exporting Taiwan Beer to China last July, earning it NT$100 million in revenues to date. But contract manufacturing in China is necessary, Yu said, because the beer and the bottles are heavy and make the product less competitive when exported to China's market.

Yu stressed that Taiwan Beer produced in China would not be exported back to Taiwan. He said the formula used to produce the beer there will be different from that used in Taiwan, and the beer bottles will carry special markings to indicate their origin.

"The flavor will not be completely identical, but will mainly cater to the taste of consumers there," he added.

Yu also denied that the production of Taiwan Beer in China will affect the interests of TTL employees in Taiwan.

Despite Yu's comments, Chen Hsueh-hsiang, deputy director general of the National Treasury Agency under the Ministry of Finance, which supervises the operations of TTL, said the agency will ask the company to address Huang's misgivings.

"The MOF will respect TTL's business strategy but will also supervise and monitor related projects," Chen said.


24 February, 2010