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More choices with tariff cuts
http://www.sina.com.cn 2003/07/03 11:05  Shanghai Daily

  China's entry to the World Trade Organization has widened consumers' access to imported food.

  Industry officials say a tariff cut of about one-third on products will help foreign manufacturers. As part of its WTO entry in December 2001, China promised to cut its tariffs on imported foods from 33 to 20 percent by 2006.

  Candy and chocolate producers are onesgroupsset to benefit.

  "Our business has increased a lot in recent years," said Li Longhua of Hershey's Food International Trade Shanghai Ltd. "We still see a big potential in the domestic market."

  For chocolate lovers, the current choices on offer have become more difficult.

  Now in many convenient store, you can select from over 30 types of chocolates from various countries such as the United States, Belgium, Italy, Australia and South Korea. Each offers a different taste and experience for chocoholics.

  Foreign processors of fruits, milk, wine and nuts are also among the top beneficiaries of the tariff cuts.

  "Imported candy and chocolate have already gained a big share in the market," said an official with a local food association, who declined to be identified. "It will soon reach 50 percent."

  Analysts said that the tarrif reductions have come at the right time as the increase in volume and varieties of imported food is largely due to the rising demand for foreign goods.

  They said Chinese consumers are curious about imported food not only for the new taste exper-iences, but also of the various cultures in other countries.

  Case in point is Valentine's Day. The tradition originated in the West but has quickly caught on with youths in China. The occa-sion has proven to be a boon for chocolate and flowers, two traditional gifts given on the day.

  "I love foreign chocolate simply because it is more tasty," said Zuo Zhenying, a kindergarten teacher. "Their packaging also looks better than Chinese-made products."

  Not long ago, not many Chinese people could afford to buy foreign foods. At the time, a high-end bottle of imported champagne could often cost 1,000 yuan (US), about half a month's salary for many people.

  Now, with the income of Chinese people increasing, so too have the sales of those high-priced wines.

  Take Bordeaux, the well-known French wine, as an example. Its imports increased 65.52 percent in 2002 from a year earlier, according to French consulate in Shanghai.

  Another major driving force is the increasing number of foreigners who are working, studying and travelling in China. They are used to certain types of foods and will continue to purchase such products, regardless of price. Imported foods are their first choice.

  At present, the price gap between some domestic products and imported products is narrowing.

  Using infant formula milk powder as an example, 900 grams of Gain Advance from Abbott Laboratories, an imported brand, is priced at about 100 yuan at Shanghai First Food Store. In comparison, Bright's, a well-known local brand, is also priced at 100 yuan.

  In such cases, consumers will often opt for the imported brand, believing it to be of better quality.

  However, most imported foods are usually more expensive than their domestic counterparts. Shenfeng chocolate is only half the price of imported chocolate. Still, people seem to favor foreign brands such as Hershey's or Dove.

  "Chinese place a lot of emphasis on the courtesy of exchanging gifts. To give an expensive gift makes them feel as if they are showing more hospitality. The imported food is a good choice." said Chen Shaoshen, general manager of a foreign food agency in Shanghai.




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