Wine’s success in Hong Kong is a function of the drop in taxes from 80% to zero, the Wall Street Journal says. That’s driven sales in Hong Kong to $47m:

Surging demand for quality wine from China’s newly rich, combined with the recent elimination of all wine duties in this bastion of free trade, is transforming Hong Kong into a global hub for wine trading and distribution.

Wine imports to Hong Kong jumped more than 34% to 32.5 million liters in the year ended March 31. Wine sellers and collectors say that inflow is coming from several sources—longtime Asian collectors who are moving their wines closer to home, wine sellers who have recently set up shop in the city and buyers who are simply taking advantage of the no-tax policy to ship a broader array of wines home from overseas.

Sales at Hong Kong wine auctions have reached US$47.2 million so far this year, a 75% increase from all of 2008, according to government data.

Wealthy Chinese Make Hong Kong a New Wine Hub (Wall Street Journal)