How to Make French Wine Like a Chinese Billionaire
China is famous for its baiju (rice wine). It’s a staple at everything from Communist Party banquets to weddings and boozy, late-night karaoke sessions with prospective clients. A common Chinese expression at such gatherings is “ni neng he duoshao?” (How much can you drink?), which is meant to equate a person’s worthiness with the amount of baiju they can withstand. It’s consumed voraciously, irresponsibly and shots of it must be downed in a single “gan bei” gulp. In places like Beijing, the sight of businessmen emptying their stomachs onto the sidewalk after an evening work function is a regular feature of the landscape.
Yet despite the fact that baijiu is such an integral part of Chinese culture, the Chinese government has been trying to dissuade its consumption for years. Chairman Mao famously advised the population to drink (grape) wine instead of rice wine or beer because he was concerned about the country’s food security and grain supply—a message that the party has continued to transmit. An aggressive government imposed anti-food waste campaign is raging in China at the moment. Although it’s unlikely that baijiu will be dethroned as the most widely consumed spirit in the world anytime soon, over the past 10 years, the Party has seen its wish for more wine come true. 500 new wineries have sprouted up in China, and in a bid to cultivate their wine-producing game, Chinese investors have purchased vineyards all over the world—from California, Australia and New Zealand to South Africa and Chile. Nowhere has their presence been felt more prominently than in Bordeaux, where vineyards come with the added perk of a castle, and where world-class art, fashion and private jets—Dassault Aviation has a production facility there—can also conveniently be procured.
Zhou Yunjie is one such high-flying investor. The chief executive of Shenzhen-based ORG Packaging, he’s owned Australia’s Sunshine Creek vineyard since 2008 and purchased Bordeaux’s Château Renon in 2014. At the time, the property was in a complete state of disarray, as the family that had owned it for decades no longer had the funds to maintain it. He spent 6 million euros to restore it to its former glory, hiring the most sought after French architects and oenophiles, as well as a Feng Shui master to advise him along the way—a renovation process that took over three years to complete. Today, it looks magnificently French, with the exception of the massive mahjong table (upholstered in a rich cerulean velvet to match with the rest of the furniture) that sits in the living room of the guest house. When plugged in, it makes a thunderous noise and flashes red and white like an ambulance, its funhouse sounds a sharp contrast to those of the concert piano in the living room.
Zhou visits France a few times a year to visit his property, see football matches (he owns AJ Auxerre, a club based in Burgundy) and check on the Quanjude roast duck restaurant that he opened in downtown Bordeaux. While he’s away, Alex and Charline Liu, a husband and wife team from Beijing, help him manage the restaurant, the Château and all international sales of the Cadillac Côtes de Bordeaux produced there. Both fluent in French, they live on the property with their 10-year-old daughter who speaks perfect French and attends a local school. She spends her day running through the immense “bicultural” vegetable garden on the property (it has both Western eggplants and Chinese ones, idem for the cucumbers), swimming in the inground pool, tickling the ivories of a very grand piano, and occasionally learning to fence—Mr. Zhou owns a fencing club in Beijing and has a fencing hall on the property. “We could never give her this life in China,” Alex says.
Château Renon is one of 160 properties in Bordeaux owned by Chinese investors. Purchased for 6 million euros, it is one of the more modest properties and is characteristic of the second wave of Chinese investment in Bordeaux, which is marked by smaller purchases (5 million euro transactions instead of 50 million) that emphasize quality over quantity. Jack Ma owns six such châteaux and has made no secret of his taste for fine wine. “Bad wine hurts your stomach, good wine hurts your head, no wine hurts your heart,” is how he sums up his feelings about it. Lina Fan, the president of Capital Prestige Consulting, has advised on many of these purchases by Chinese investors and explains that although initially met with sour grapes, they’ve become increasingly welcome in the region.
Some of this has to do with the money they’ve spent in Bordeaux. A former Dassault employee explains that seeing her clients fill the cargo holds of their private jets with French wine was a regular occurrence. One of her clients even used his jet to transport a Van Gogh that he’d purchased while château-shopping in France. Deeming the piece too fragile to go into the overhead luggage, he wrapped it in a tea towel and traveled back to Beijing with it on his lap.
Although lavish spending helps, a friendly welcome by the French can’t be bought, insists Fan; it must be earned. Initially, this message was completely lost on most Chinese investors, who threw money around on opulent properties, sometimes as a way of laundering it or using the purchase of a château as a means through which to get money out of the country as Beijing tightened its capital controls. Then there were the Chinese State-owned enterprises—Moutai, the famed baijiu maker, being one of them—that expected to produce mediocre wine in Bordeaux, put it in a fancy French bottle and sell it for a significant markup to clients in China who wouldn’t know the difference. On most fronts, these plans failed. Chinese investors instead learned the hard way that owning a château is not a business. “It’s more like a mistress,” says Fan, who has been based in Bordeaux for more than a decade and has advised and managed vineyards there for several high-profile Chinese investors. “It’s never satisfied, and it requires continuous attention and investment.”
Peter Kwok, who heads the energy subsidiary of Chinese investment group CITIC, understood this earlier than most. He made his first investment in Bordeaux in 1997 and to-date has spent over 70 million euros in the region. The crown jewel of his properties is Château Bellefont-Belcier, which when he purchased it in 2018, marked the first-ever sale of a Grand Cru Classé estate (the most prestigious appellation in Bordeaux) to a Chinese buyer. At the time of the sale, there was concern that France was losing a prized piece of its patrimoine and that Château Bellefont-Belcier wine would cease to be available anywhere outside of China, but that has not been the case. Like most discerning Chinese investors, Kwok has understood that when it comes to winemaking, China needs France and France needs China.
As Chinese investment in French winemaking has increased, the opposite has also happened. LVMH produced its first vintage in China in 2013 from a 75-acre vineyard at the foothills of the Himalayas, not far from Shangri-La. Similarly, Bordeaux’s own legendary Château Lafite will bring its second vintage to market this year, after French winemakers spent more than 10 years preparing the terraced slopes and granite soils of the Qiu Shan Valley in Shandong to yield quality grapes. Bottles of Lafite regularly sell for over $1,000 USD each and enjoy very strong brand recognition in China. Jean-Sébastien Philippe, the company’s commercial director, explains that Lafite’s line of “Long Dai” wines produced in China are intended to have the same effect, but are also an excuse for the company to reinvent itself. Bordeaux, where the iconic Lafite brand was born, has stringent regulations about which grapes can and cannot be mixed, and even has punishing rules about when they can be watered, in order to prevent water shortages or create an uneven playing field for those with fewer resources. This leaves little room for creativity and experimentation, which the 152-year-old brand finds itself craving.
Domestically, France still seeks to preserve its wine patrimoine, but requires foreign investment to help sustain it. Likewise, China is eager to improve domestic production quality and gain international recognition for its wines but requires foreign savoir-faire and validation to help it do so. Fortunately, these goals are complementary. While Chinese winemakers in Bordeaux may revel in the prestige and tradition of a Grand Cru, French winemakers find it exhilarating to experiment with new appellations and techniques in China that would be forbidden at home, Philippe explains. As an added bonus, he notes that the characteristics of the land and the curiosity and talent of the locals—many of whom have studied in France—all lend themselves to quality winemaking. “What may seem to China like validation of its winemaking potential is really an excellent opportunity for us to innovate.”