The Taiwan Tobacco and Wine Monopoly Board (TTWMB,
Far East Distillers agreed to supply 15 million 0.6-liter bottles -- or nine million liters -- of rice wine worth US$6.23 million, with the first five million bottles for shipment to Taiwan before Jan. 20, a board official was quoted as saying.
"Singapore's Far East offered US$0.415 per bottle to win the bid from three other bidders from Indonesia, Thailand and South Korea," the official said.
The official said the board turned to imports to ease the recent hoarding of rice wine.
"We decided to import rice wine because we are concerned that our production capacity will be unable to meet the increased market demand," said Wei Yau-hsuan (
The TTWMB would watch how the market reacts to the imports so as to determine when to complete the shipments, he said. The imports will retail for NT$24 a bottle, a price comparable to locally-produced rice wine.
Since the Legislative Yuan began reviewing the Tobacco and Wine Management Law (
The legislation, which is still under review, will transform the government-run TTWMB first into a corporation, and then into a private firm within five years following the enforcement of the law. The legislation will also allow the eventual production of wine, beer and distilled spirits by local and foreign firms. Taiwan already has liberalized imports of distilled liquors and beer, but has yet to lift restrictions on their production -- a liberalization likely to be phased in with WTO accession.
The TTWMB has a production capacity of 216 million bottles of rice wine a year. Officials at the board said demand this year was expected to exceed production because of the recent hoarding.
Wei said the board expects the domestic demand of rice wine would drop significantly after the enforcement of the new law, which would allow higher taxes to be imposed on rice wine, resulting in higher wine prices.
The legislation calls for rice wine to be taxed at the same NT$185-a-liter rate that applies to whisky and other distilled spirits -- a move that would add NT$111 to the price of a 0.6 liter bottle that now costs just NT$20.
However, the tax would not be implemented until Taiwan enters the WTO and would be phased in over five years.
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