(Bloomberg) -- Pernod Ricard SA will soon add a new made-in-China line of malt whiskey to its portfolio as it doubles down on a country that's driving its strongest earnings growth in seven years.
The maker of Jameson and Ballantine's is building its first malt whiskey distillery in China, in the southwest province of Sichuan, and will produce at least one new whiskey brand for sale in China and the rest of the world at the earliest by 2023, said Philippe Guettat, the company's Asia chief executive officer.
“We will have a Chinese master distiller, who's working at the moment to find an appropriate way of bringing the Chinese dimension to this brand, whether it's in terms of ingredient, distillation or filtration,” he said in an interview Thursday.
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Global liquor companies are accelerating their investment in the world's second-largest economy as the potential of the $178 billion Chinese alcohol market comes into focus. While Chinese consumers still mostly drink baijiu, a fiery local grain liquor, interest in western alcohol like whiskey and gin is on the rise. Pernod Ricard's British rival, Diageo Plc, launched a whiskey for the Chinese market earlier this year in collaboration with a baijiu distiller.
Pernod Ricard plans to invest as much as $150 million over the next decade in its Chinese distillery, which will also have a visitor center where consumers can taste whiskey while enjoying the landscape of Mount Emei, one of China's most famous peaks.
Guettat said that revenue growth in China will be at high single digits to low double digits in the mid to long-term. The Chinese economy is now grappling with its slowest pace of growth in three decades amid an ongoing trade war with the U.S.
“In China, we have been operating for close to 40 years, we have more than 1,000 employees, we are making roughly 10% of Pernod Ricard sales revenue here, so we are fully committed to it,” he said. “We have a very strong belief in the development of China, even if the economy is slowing.”
To contact Bloomberg News staff for this story: Wendy Hu in Beijing at whu109@bloomberg.net
To contact the editors responsible for this story: Sharon Chen at schen462@bloomberg.net, Rachel Chang
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