food / travel

China Wine Production Soars To Seventh In Global Rankings

Though France and Italy still leading winemakers, Chinese production to grow another 77% by 2014

BORDEAUX - This was unexpected: China is now one of the largest producers of wine in the world. The world's most populous country, which only recently discovered wine, has pushed ahead to take seventh place in global rankings in 2010 according to a study by the International Wine and Spirit Record (IWSR), conducted for the international exhibition for Bordeaux wines, Vinexpo.

Until 2007, China did not rank among the top 10 producers. Its exponential growth is expected to continue, with estimated 77 percent growth in its production from now to 2014, which IWSR says would be "the strongest five-year increase the world has ever seen."

China is thus expected to be the growth engine of the sector in the coming years, ahead of the United States and Russia. Production is steadily developing thanks to Chinese investment, or Europeans with local stakeholders in the region south of Shanghai.

The room for growth remains significant in a country of an estimated 100 million wine consumers today, said Robert Beynat, the director of Vinexpo. Bordeaux wines first offered the most fortunate Chinese a taste for grands crus, but are now looking to democratize consumption, introducing less expensive wines to a larger number of people. "We want to make them understand that wine is not only for the elite, and that there are some very good bottles in the five to ten-dollar range," Beynat explained.

Rosés on the rise

In spite of the Chinese breakthrough, more than half of global production is still concentrated in three countries: Italy, France and Spain. The first two are neck-in-neck in terms of production rates.

Even with a small harvest last year, France, with a production of 419 million cases, edged out Italy as the global wine leader, a title it conceded to Italy in 2009. The US, Argentina and Australia round out the top six, ahead of China.

On the consumption side, the IWSR predicts that the United States is poised to become the top consuming country in 2012, ahead of Italy and France. The consumption of non-sparkling wine in the U.S. should increase by 9 percent from now until 2014, with Italy and France at only 1 percent and 4 percent respectively. The general tendency in Europe is toward a more selective attitude on the part of the consumer, even if it means paying more in order to find the best blends.

In terms of type, rosés are showing the most potential. They are set to expand by about 8 percent from now until 2014, though representing 9 percent of the total wine produced in the world. Next come effervescent wines, with an expected 6 percent increase. Reds are projected to grow by 4 percent, according to the IWSR, with whites coming in at 2.5 percent.

Wine is ever more an engine of trade: even in France, one out of every four bottles consumed is imported. Overall, Italy is the top exporter in terms of volume, France is first in value.

Read the original article in French

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Society

Debt Trap: Why South Korean Economics Explains Squid Game

Crunching the numbers of South Korea's personal and household debt offers a glimpse into what drives the win-or-die plot of the Netflix hit produced in the Asian country.

In the Netflix series, losers of the game face death

Yip Wing Sum

-Analysis-

SEOUL — The South Korean series Squid Game has become the most viewed series on Netflix, watched by over 111 million viewers and counting. It has also generated a wave of debate online and off about its provocative message about contemporary life.

The plot follows the story of a desperate man in debt, who receives a mysterious invitation to play a game in which the contestants gamble their lives on six childhood games, with the winner awarded a prize of 45.6 billion won ($38 million)... while the losers face death.


It's a plot that many have noted is not quite as surreal as it sounds, a reflection of the reality of Korean society today mired in personal debt.

Seoul housing prices top London and New York

In the polished streets of downtown Seoul, one sees endless cards and coupons advertising loans scattered on the ground. Since the outbreak of the pandemic, as the demand for loans in South Korea has exploded, lax lending policies have led to a rapid increase in personal debt.

According to the South Korean Central Bank's "Monetary Credit Policy Report," household debt reached 105% of GDP in the first quarter of this year, equivalent to approximately $1.5 trillion at the end of March, with a major share tied up in home mortgages.

Average home loans are equivalent to 270% of annual income.

One reason behind the debts is the soaring housing prices. In Seoul, home to nearly half of the country's population, housing prices are now among the highest in the world. The price to income ratio (PIR), which weighs the average price of a home to the average annual household income, is 12.04 in Seoul, compared to 8.4 in San Francisco, 8.2 in London and 5.4 in New York.

According to the Korea Real Estate Commission, 42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s. For those in their 30s, the average amount borrowed is equivalent to 270% of their annual income.

Playing the stock market

At the same time, the South Korean stock market is booming. The increased demand to buy stocks has led to an increase in other loans such as credit. The ratio for Korean shareholders conducting credit financing, i.e. borrowing from securities companies to secure stock holdings, had reached 21.4 trillion won ($17.7 billion), further increasing the indebtedness of households.

A 30-year-old Seoul office worker who bought stocks through various forms of borrowing was interviewed by Reuters this year, and said he was "very foolish not to take advantage of the rebound."

In addition to his 100 million won ($84,000) overdraft account, he also took out a 100 million won loan against his house in Seoul, and a 50 million won stock pledge. All of these demands on the stock market have further exacerbated the problem of household debt.

42.1% of all home purchases in January 2021 were by young Koreans in their 20s and 30s

Simon Shin/SOPA Images/ZUMA

Game of survival

In response to the accumulating financial risks, the Bank of Korea has restricted the release of loans and has announced its first interest rate hike in three years at the end of August.

But experts believe that even if banks cut loans or raise interest rates, those who need money will look for other ways to borrow, often turning to more costly institutions and mechanisms.

This all risks leading to what one can call a "debt trap," one loan piling on top of another. That brings us back to the plot of Squid Game, "Either you live or I do." South Korean society has turned into a game of survival.

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