Australian Prime Minister John Howard is in China this week, talking up the new-found economic co-operation between the two countries. But one Australian icon, the brewing company Fosters, has just announced it is quitting the Chinese market after an unsuccessful 13-year stint.
The Fosters Group announced last month that it had sold the last of its Chinese assets, its Shanghai brewery, to the Japanese brewer Suntory for A$20 million ($113 million).
For this major Australian corporation, the China experiment has been a dismal failure. The brewer, which is also the world's second-biggest wine-maker, has lost over A$100 million in China over the past decade.
Fosters didn't simply dip its toes into mainland waters: it plunged in head-first, in 1993. The company bought breweries in Guangdong and Tianjin , in addition to Shanghai.
The first signs of trouble came as far back as 1998, when Fosters wrote down the value of its Chinese operations by a whopping A$167 million. This forced the sale of the Guangdong and Tianjin interests a year later, while the Shanghai brewery - which produces Shanghai Lager and the Guangming, Qing Yi and Yi Hao brands - limped on until last week.
But if Suntory is to be believed, there is not a lot wrong with the Shanghai brewery. The Japanese company already has 54 per cent of the Shanghai beer market, and this purchase of the Fosters asset will give it over 60 per cent.
Fosters is not getting out of China altogether - it cannot afford to ignore the rapidly growing Chinese middle class, which is fast acquiring a thirst for premium beers of the type that Fosters produces. The company says it will continue to market its beers in China.