Duties threaten beverage makers

PUBLISHED : Thursday, 17 August, 1995, 12:00am
UPDATED : Thursday, 17 August, 1995, 12:00am

THE key lobby group for Hong Kong's beverage makers is to tackle the Government over duties which it says discriminate against domestic beer brewers.


Winston Lo, the newly appointed president of the Beverage Manufacturers Association of Hong Kong, said recent changes in beer duty legislation meant domestic breweries had to pay duty on various component costs of production not levied on imported beers.


Beer importers were able to undercut domestic products.


He said there had been a direct impact on the profits of big Hong Kong brewers like San Miguel.


Mr Lo, who is chairman and managing director of Vitasoy International Holdings, said a variety of problems had brought about a slowdown in the growth of the overall domestic beverage market.


He said 1994 was the first year in which the industry experienced no year-on-year growth, based on total combined data of sales of carbonated and non-carbonated beverages, beer and milk.


'The local environment has always been highly competitive,' he said.


'However, in recent years, the market has been facing a range of additional difficulties.


'All sectors have been faced with rising material costs beyond the level of inflation and higher wage bills.' Mr Lo said these factors, coupled with adverse weather conditions, had affected sales, and limiting price increments to below the rate of inflation.