The Economic Contribution of International Spirits in Hong Kong
Commissioned by
The European Chamber of Commerce in Hong Kong
Since fully reopening its borders in 2023, the Hong Kong government has aimed to attract international tourists and stimulate consumer spending in the hospitality and retail sectors. A key element of this strategy is providing a high-quality and diverse range of food and beverage options.
Commissioned by the European Chamber of Commerce in Hong Kong, this report by Oxford Economics examines the contribution of international spirits—an important component of Hong Kong’s tourism and hospitality offerings—to the economy.
The trend of “premiumisation” is shaping the recovery of these sectors, characterised by consumers increasingly opting for more expensive, higher-quality products. This report also explores the economic opportunities that premiumisation presents for Hong Kong.
Meanwhile, the current 100% ad valorem excise tax on spirits discourages premium consumption. In this report, we review studies from institutions like the World Health Organisation, which advocate for a shift to specific excise taxes based on volume or alcohol content, instead of value. Such taxes are more effective at discouraging excessive consumption and can support premiumisation by creating a more favourable market for high value products and services. It can also reduce administrative burdens, and lead to more stable tax revenues.
Our analysis suggests that international spirits contributed HKD 1.4 billion to Hong Kong’s GDP in 2023, supporting around 5,200 jobs and generating HKD 1.3 billion in tax revenues. Reforming the tax structure could further enhance the spirits industry’s economic benefits, bolstering Hong Kong’s position as a leading spirits hub in Asia and aiding the city’s recovery from the pandemic.
The experts behind the research
Our Economic Consulting team are world leaders in quantitative economic analysis, working with clients around the globe and across sectors to build models, forecast markets and evaluate interventions using state-of-the art techniques. Lead consultants on this project were:
Liam Cordingley
Lead Economist, Economic Impact
Hwee Shi Yong
Graduate Assistant Economist, Economic Impact
Contact Us
Tags:
More Economic Impact Reports
Impacts of the proposed Los Angeles fast food ordinance
Save Local Restaurants commissioned Oxford Economics to calculate high-level cost estimates relating to a proposed city ordinance that would impose new requirements on quick-service restaurant operators in Los Angeles.
Find Out More
Catalyzing Africa’s Sustainable Transition: Insights to Impact a Climate-Resilient Future
Sustainable finance is not merely a climate imperative but a development necessity. As climate risks intensify, Africa must urgently mobilise capital to advance its adaptation, mitigation, and development goals. Realising this ambition will require coordinated action across governments, financial institutions, international partners, multilateral agencies, and the private sector. With bold leadership, innovative tools, and supportive ecosystems, the continent can chart a path toward a more inclusive, resilient, and sustainable global economy.
Find Out More
The economic impact of Project Kuiper’s launch partnerships in the EU
The report assesses the economic impact of Project Kuiper's launch partnerships in the EU.
Find Out More
Election result delivers some welcome certainty in Australia
The past month has been relatively quiet compared to the flurry of activity following the 'liberation day' tariff announcements in the US.
Find Out More