Approaching Asia Tom Poole

1. Approaching Asia Tom Poole

2. - Overview • 45 years of international trade show experience across Asia & China • Allworld Exhibitions introduces organisations and companies to trade professional visitors across the Middle East & Asia • Industries include: food, oil, gas, mining, machinery, woodworking, communications, jewellery, defence, packaging, processing, plastics, rubber • Comprised of member companies in 13 countries • Members currently organise 150 international exhibitions throughout the world over a two year period • Allworld Exhibitions continue to create opportunities in developing markets

3. Asia Overview • Total population of Asia is 4.4 billion people – over 60% of the world population • 4 of the 16 largest economies in the world are found in Asia • 50% of Asia’s population is 32 or younger with a median age of 33.35 • Asian nations use English as their language of business, and roughly 15% of the whole continent can speak fluent English with an expanding group of countries using English as their second language • Asia saw 279 million international arrivals in 2015 – growth of 6% from 2014 • As of Jan 2015, almost 200 billion USD has been invested in Asia-Pacific airport construction, accounting for 35.1% worldwide.

4. Population of 1.357 billion - largest population in the world • GDP $17.6 trillion (largest in the world) with steadily rising growth of 6.5-7% forecast for the future • Largest food and beverage importer in the world • China is very interested in Ukraine because: • its central location on the route between China and the EU • Chinese have interest in a trading route that bypasses Russia • Ukraine has good trade links with the EU • Interest in Ukrainian agricultural products China - Overview • Rising incomes and reducing farmlands are increasing demand for imported food products • Key driver is huge rise in online purchases and e-commerce forecast to grow nearly 50% from 672 billion in 2015 to 911 billion US dollars in 2016 • In line with Asia – young population is driving force behind changing tastes

5. China’s pork consumption is forecast to rise to 61 million tonnes this year, up from 50 million 5 years ago and imports have risen on average 20% each year in this period. • EU has already begun capitalising on this market, with its pork exports to China increasing 93% from Q1 2015 to Q1 2016. • Chinese beef imports increased by 50% in 2015 compared to 2014 • China consumes 28% of world meat • Though China is the world’s largest producer, consumer, importer and exporter of fishery products, to meet growing in-country consumption, imports are projected to increase. • China’s fish imports are projected to hit 4.4 million tonnes by 2022, growing by an average 2.1% annually. China – Meat and Seafood

6. 5th largest wine consumer in the world • The premium imported beer market will grow by value to over US$ 610 million in 2020 recording 148% growth from current figures • China’s spending wine imports grew 32% in 2014 from $1.13 bn to $1.49bn in 2015 • Growing taste for alcohol a result of Westernisation and growing middle class • Bacardi (Bacardi rum, Grey Goose vodka)have recently selected JD.com to be their exclusive partner for online spirit sales. Clearly seeing potential in spirit market in China • With nearly 60 million tourist arrivals a year, there is also a huge market for hotels, and restaurants to source high quality spirits and wines China - Alcohol

7. China – Fruit • Decline in farmable land and increasing population has created a growing demand for fresh fruit • Food safety fears mean imported fruit is seen as higher quality, and more reliable • In 2014, China’s fresh fruit imports increased 22.8% compared to the previous year. • Huge demand for high quality fruits namely: apples, grapes, cherries, blueberries and citrus fruits • Large preference for fresh fruit • 4 of 5 top fruit/veg imports are from Northern Hemisphere • Non-native fruit requires focused promotion, as awareness will be lower Cherry imports into China

8. China – Dairy • 40% increase in dairy imports in Q1 of 2016 • Increases in demand for milk powder imports • Driven by demand from yoghurt and children’s food manufacturers • Nutritional demands, population growth and higher incomes have pushed almost all dairy products demand up as well. Supply in China is already largely outpaced by demand due to increased urban living and reduction in producers • The expanding middle class has led to an increase of cheese imports (average expansion of 14% per year since 2011)

9. China – Coffee • In line with Asia, huge increases in demand for coffee across China • From 2014 to 2019, Chinese coffee consumption is projected to rise 18% annually, as compared to the 0.9% in the US • Chinese market less keen on bitter taste of unsweetened black coffee so bigger brands have created pre-made packets including milk powder and sugar in order to satisfy taste demands • Chinese coffee drinkers prefer to sit and consume rather than ‘take-out’ so larger brands have combined coffee shops with large seated areas. • Huge growth potential in coffee consumption in an already rapidly moving market – Japan for example consume 34 times as much coffee as China

10. Economy continues to grow even after rapid growth of last 20 years • Continued growth has led to a growing middle income group with a young driving force - keen on coffee, wine, good quality meat and tastes from around the world • Opportunity to market fresh ‘in-season’ products that may not usually be available at that time of the year in China or from their surrounding import partners • Further increases in demand for wines from around the world that look set to continue. Clear, established demand for South African wines exists • Urbanisation has led to a fall in locally farmed produce so growing market in imported fresh fruit, vegetables, wheat, nuts and dairy products amongst many others – China is now a net importer of food China - Benefits

11. Facts and Figures FHC China, Shanghai 7th- 9th November 2016 Venue: SNIEC - Shanghai New International Expo Centre, China FHC China 2015 statistics - 19th edition (running since 1994) - 85,000 sqm - 2,150 exhibiting companies from 66 countries/regions - 39 international pavilions - 66,561 trade visitors Show facts - annual show - established in 1996 - incorporates: Meat @ FHC China 2016, Tea & Coffee China 2016 Beer China 2016 Dairy China 2016 Fresh Produce China 2016

12. Facts and Figures Prowine China, Shanghai 7th- 9th November 2016 Venue: SNIEC - Shanghai New International Expo Centre, China China wine market information Show facts - annual show - established in 2013 - partnership between Allworld and Messe Duesseldorf • Increase in demand for wine of around 40% over last 5 years – 1.86 billion bottles of red wine sold in 2012 • Chinese wine market forecast to grow by at least 5% every year until at least 2020 • In 2015 bottled wine imports rose by 38.7% in volume to 297.7m litres and by 34.7% in value to $1.4bn • In 2015 bulk wine imports grew 100% compared • with 2014 – from 49 million litres, to 98 million • litres Prowine China 2015 statistics - 3rd edition (running since 2013) - sqm - exhibiting companies from 66 66 countries/regions - 39 international pavilions - 66,561 trade visitors

13. Population of 5.7 million and is the third most densely populated country in the world • Singapore is reliant on food imports for over 90 per cent of its needs, having very little agricultural land and limited domestic food production - only one per cent of Singapore's land area is used for agricultural purposes Singapore – Overview • The number of US dollar millionaires in the city-state doubled in the five years to 2012, to more than 183,000. By 2017 Singapore will be home to nearly 300,000 US dollar millionaires • Singapore has earned the distinction of being ‘one of the top 10 food cities in the world’ according to Lonely Planet. • Singapore is one of the world’s most open economies and is highly dependent on international trade. The volume of its external trade is about three and a half times its annual Gross Domestic Product. Any decline in the economies of its major trading partners like the United States, the European Union, Japan and China is immediately felt.

14. Currently 80% of beef in Singapore is imported from Australia, New Zealand and Argentina – showing Singaporeans will choose quality of product over price • Two thirds of supermarket pork sales in Singapore are Australian pork • Singapore saw an increase in spending on red meat imports from US$572 million to US$698 million between 2010 and 2012 - a 22% total increase • Fish and shellfish is deeply entrenched in Singapore’s diet – fish and shellfish are staple foods that are eaten almost every day. The majority is imported from neighbouring Asian countries, but there is a clear demand for quality seafood that could compete with Singapore’s neighbours • Naturally China lead the market for Singapore’s subtropical fish imports (salmon, mackerel, cod, yellow fin tuna etc.) however other market leaders include Chile, Norway and Australia showing there is scope for other countries to penetrate the market – South Africa are currently within the top 10 ranked alongside USA and France Singapore fish market potential Singapore – Meat and Seafood (H – High, M- Medium, L – Low)

15. According to Euromonitor, wine saw a 5% total volume growth in 2014, reaching 11 million litres in Singapore. • Singaporeans understand wine and follow new global trends. They have a sophisticated set of experiences, which encourages the matching of wine with food and trying wine from different countries around the world. • Alcoholic spirit consumption has increased by 83% in the last 5 years • It is predicted the craft beer market could grow 200-300% over the next 3 years, and offers the biggest growth potential in alcohol • 80% of alcohol imported to Singapore is beer, and annual growth of imports is around 4% • Tiger (Singapore’s beer) is losing popularity because younger drinkers prefer imported beers from around the world. Showing good prospects for beer exporters Singapore – Wine, beer and spirits

16. The major suppliers of fresh temperate climatic fruit to Singapore are the United States, Australia, New Zealand, European Union, China, South Africa, Argentina and Chile • Between 2012 and 2015 Singapore saw a 14% increase in imports of fresh fruit • Interesting tropical fruits are papaya, pineapple, watermelon, passion fruit, star fruit, guava and lychee. The first three perhaps are the highest demand as they are served in all hotels and restaurants. • Australia compete with Asian nations in the market for vegetables in Singapore across a variety of different vegetables. Though labour costs are cheaper in Asia there is a clear market for quality and organic produce in Singapore - Australia provide a quarter of the main vegetables consumed in Singapore including lettuce, broccoli, carrot and asparagus • Quality, reliability, availability and good supply line connections are also important in determining the source of vegetable imports in Singapore – not purely price Singapore – Fruit and Vegetables

17. The increasing demand for dairy products in Singapore is met almost entirely through imports. There is little to no domestic dairy production. • The major suppliers of dairy products to Singapore are European Union, Australia, New Zealand • In 2015, Singapore imported an estimated 300,000 tonnes of dairy products, making it one of the worlds leading importers. • Demand shows cheese imports growing at 5% per year. Healthier milk products such as low fat and skimmed show the most growth potential. • The Singaporean dairy market had total revenues of $656.9m in 2014, representing a compound annual growth rate (CAGR) of 5.1% between 2010 and 2014. • Market consumption volume increased with a CAGR of 4.7% between 2010 and 2014, to reach a total of 39.6 million kg in 2014. Singapore – Dairy

18. Growth of Singaporean coffee sales stabilised at 3% in 2014 and is primarily in the off-trade market. Imports are mainly for use in food service outlets including major modern coffee shop chains. • In this particular market, coffee manufacturers have found success with premium products, e.g., arabica coffee beans, coffee fortified coffee with additional nutrients. • There has been a gradual shift in coffee sales from business-to-consumer to business-to-business. Some manufacturers see a huge potential for office sales as working adults (the major consumer group of coffee products) tend to drink more in the office environment during the week than they do at home on the weekend. • Though there is a strong domestic coffee culture, with the burgeoning expatriate population combined with the growing youth, the market for specialty coffees is expanding: though most over 30s still prefer Kopi Tiam (traditional Singaporean coffee), some 20% of under 30s are drinking gourmet, with that number on the rise. Singapore – Coffee

19. Fast growing incomes and highly educated population with strong demands for wines, meats, dairy and organic produce – with a reliance on imports • Increasing preference for higher quality products, and Singaporeans are happy to pay extra for this quality • A steady tourism industry, and business people travelling into Singapore from across the world means by tapping into Singapore there is the opportunity to spread a worldwide brand awareness when people return home • According to a Singapore Health Promotion Board in a recent survey half of those surveyed ate out eight or more times a week – a clear demand for restaurant products and variety • As the market for consumer oriented products is very open and easily accessible, there is fairly quick entry for new comers. Singapore – Benefits

20. Facts and Figures Food and Hotel Asia, Singapore 24th-27th April 2018 Venue: Singapore Expo, Singapore Biennial show, now in its 21st edition. Since its debut in 1978, FHA has always been the premier sourcing platform for thousands of food and hospitality trade buyers in Asia and is Asia's largest international food and hospitality trade event. FHA 2016 statistics: - 97,000 sqm - 3,189 companies from 70 countries and regions - 60 international pavilions - 47,630 trade visitors – 19,953 from overseas Incorporating: Food Asia 2018, Hotel Asia 2018, Bakery & Pastry 2018, Hospitality Style Asia 2018, Hospitality Technology 2018, Speciality Coffee & Tea 2018

21. Facts and Figures Prowine Asia, Singapore, 24th-27th April 2018 Venue: Singapore Expo, Singapore Asian wine market • Show facts • annual show launched in 2016 • Alternates between FHA and HOFEX • organised as a partnership between Allworld • and Messe Dusseldorf (Prowein organisers) • Established after success of Prowine • China partnership • FHA/Prowine Asia 2018 forecast statistics • -105,000 sqm • -3,300 companies from 64 countries and regions • -60 international pavilions • -50,000 trade visitors – 20,000 from overseas • Demand for wine in Asia is on the rise, with the region generation $28 billion of sales in 2013 • Asia accounted for 48.6% of revenue from spirits sales worldwide, while consuming 61.5% of the total world volume • Southeast Asia sees 7 million new prospective drinkers join the market yearly, with a 13% increase in spending • Asian wine consumption is expected to grow by 22.84% from 2013 to 2017

22. Population 30 million • With per capita income of over $9,890 and a middle and upper class making up 61 percent of the population, Malaysia shows good potential for growth as a market for high value consumer products • Food and beverage expenditure accounts for 25% of the total consumer spending • Steady GDP per capita growth since 2005 that is forecast to continue • Total spend on consumer oriented fish products top US$6 billion a year • Prospects for export are fresh fruits and vegetables, pet foods, dried fruits, nuts, frozen potatoes and processed juices Malaysia – Overview

23. Malaysia is a country which is 60% Muslim who will only eat halal meat but no pork, the high percentage of Hindus will not eat beef so the largest demand for meat in Malaysia tends to be halal certified meat, poultry and seafood • Increases in consumer spending power though has seen the demand for red meat develop over recent years – main imports are from India, Australia and New Zealand, in terms of beef this requires halal for the Muslim consumers • Beef demand is forecast to increase by 98% between 2014 and 2030 • Malaysia has a very high per capita consumption of fish and seafood, approximately 50kg per year since 2005 and this is forecast to continue to grow to 55kg per capita in 2020 • Rises in fresh seafood prices have driven Malaysians to purchase more frozen seafood so there is currently a big demand for frozen scallops, frozen prawns and fish, as well as fresh mussels and oysters as a result of rising middle income families Malaysia – Meat and Seafood

24. Malaysia is not a wine producing country and is import-dependent. The Malaysian wine market value is estimated at US$76.63 million, with a total imported volume of 6,162 tonnes in 2011 • Reasons for expansions in demand for wine are increased awareness, as well as increased knowledge and appreciation for wines by the consumer, and also the fact wine is more affordable and a healthier alternative compared to spirits • Though a majority Muslim country, Malaysia is still the 10th largest alcohol consuming country worldwide – because of expatriates and tourism. • Beer import growth has continued at around 5% a year for the last 5 years, showing the market is steadily growing. • There are only 2 commercial breweries in Malaysia • Craft beer movement is in its infancy, but shows huge potential over the coming years Malaysia – Beer, wine and spirits

25. Though Malaysia produces a lot of fruit, it is still a net importer of fresh and processed fruits, with an import value of approximately $174 million. • Malaysia imports almost 110,000 tonnes of apples per annum – with a growth of almost 40% since 2003, due to urbanisation, modern retailers, and being an open market without import restrictions • Malaysians are becoming increasingly health conscious due to the rise of diabetes, hypertension, and obesity among the population, leading to foodservice operators adding healthier food choices to their menus. • Malaysia tends to import temperate vegetables only, with import value $401.7 million. Malaysia – Fruits & Vegetables

26. Malaysia is a principal market for skim milk powder (SMP). Imports grew 25% year-on-year through to July 2014 and were projected to continue in this fashion. • In 2009-2011, 1.1 million tonnes of milk and milk products were imported into the country. • In general, the Malaysian dairy market has been growing at around 7% a year • Cheese is estimated to grow positively as the population becomes more health conscious, given that cheese has high calcium and will benefit their children’s health. • Growing milk demands actually resulted in a shortage in supply during 2014, which has encouraged further imports from overseas. • Drinking milk products are expected to grow by a value CAGR of 2% at constant 2014, as drinking milk is also part and parcel of the trend towards healthy food. Malaysia – Dairy

27. The first coffee wave in Malaysia was the local coffee in kopitiams, followed by commercialised coffees in the late 80s and early 90s bringing the second wave. Malaysia now describes itself as being in the third wave and focused on specialty coffees. • Consumers are looking for better-tasting coffee accompanied with better value for money, as there are a high number of brands and variants available. Young people in particular are demanding fashionable and convenient products • Malaysia is experiencing the ‘café culture’ movement and seeing more and more coffee shops offering ranges of coffee products • Growth of coffee imports increased 7% in 2015 • Consumers bought more products in 2014 as tea has a strong reputation for health benefits and consumers are projected to be increasingly willing to try out new varieties and brands. Malaysia – Coffee and Tea

28. Malaysians are already familiar with western foods and with western menus so they have a taste already, and things like wine, dairy and meat all look set to expand • Supermarkets and hypermarkets are popular, with regular new openings providing greater access for imported foods. • There is a growing level of health consciousness amongst Malaysians which means there are demands for organic produce, a wider variety of fruit and vegetables, and fruit/vegetable juices • Malaysia is looking to expand exports, using imports as raw materials – so there is good growth potential in the basic ingredient level • A middle income group who have money to spend on new products once they enter the market Malaysia – Benefits

29. Facts and Figures FHM 2015, Kuala Lumpur - 26th – 29th September 2017 Venue: Kuala Lumpur Convention Centre, Kuala Lumpur, Malaysia Show facts - biennial show - launched • Malaysia market information • Food and beverage expenditure accounts for 25% of the total • consumer spending • Spending on food service has grown an average of 7% per year since 2008 due to busier working schedules, and the sheer increase on food service outlets. • As higher numbers are dining out, their has been a • noticeable increase in demand for wine and beer amongst • Malaysia’s 40% non-Muslim population FHM 2015 statistics - 13th edition - 17,000 sqm - exhibitors from 50 countries - 8 national groups - 22,759 trade visitors

30. Facts and Figures Food and Hotel Penang 2016, 15-17 November 2016, Penang Venue: Straits Key Convention Centre, Penang, Malaysia • Penang market information • Additional 1,157 hotel rooms to be added to Penang over next 2 years • Recent construction of SPICE and PWCC convention centres are expected to spearhead Penang’s thrust to be a major MICE destination by the end of the decade. • Local dynamic food culture, along with a rise in domestic and international visitors, has contributed largely to the growth of Penang's hospitality and tourism industry. • Show facts • Biennial show • Launched in 2014 • Run on alternate year to FHM • FH Penang 2014 statistics • 2,084 sqm • 2,000 trade visitors • 240 participating companies • participants from 29 countries • 2 national pavilions

31. Population of 67 million • Steady increase in GDP over last 10 years – though it can be dependent on flooding and weather (2010 and 2012) at which point imports have become increasingly important Thailand - Overview • Despite naturally occurring weather phenomenon such as flooding and the tsunami, Thailand has continued to see growth in international arrivals – welcoming 28 million in 2015, the largest on record • Continued spending from international arrivals has led to a thriving tourism sector and as consumers continue to spend – it continues to grow • A sustained Western presence, and hence Western products for the last 20 years has seen the nation become increasingly brand aware. The result is a huge rise in use of supermarkets stocking worldwide products, rather than going to traditional markets

32. Hotels and tourism make up almost 20% of the country’s gross domestic product; the success of the economy is based around continued positive performance • Continued growth in this sector means a persistent need for new and innovative products • According to the Thai Ministry of Tourism and Sports, 2015 tourist arrivals grew to 11.95 million, a 19% increase from the previous year. • A target of 31 million visitors has been set, generating around $42 billion in revenue. • With a number of leading international hotel chains entering the Thai market, existing hotels are readjusting their marketing strategies and focusing more on revenues from food and beverage sales. Travel and tourist markets are projected to grow by 3.3% in 2016, and 7.7% per annum through to 2025. • 4 and 5 star hotels are now generating around 40% of revenue from food and beverage sales Thailand - Hotels & Tourism

33. Thailand is the fifth largest importer of fish and seafood in Asia. • Thais have a diet that includes a huge amount of fish and seafood, so demand will always be high • Retail volume sales of fresh fish and seafood rose to 1.6 million tonnes in 2014, up 87,300 tonnes from the year previous. Euromonitor International has forecast that this increase will continue through to 2018 to over 2.1 million tonnes. • Thailand produces a large amount of seafood for the local market, but there is always demand for new types of imported fish and seafood. • Thailand has three different markets for imported fish and seafood • the very large market for imported fish and seafood ingredients and inputs for use by the seafood processing industry • A smaller market for imported fish and seafood to meet foodservice industry demands • An even smaller, niche market of imported fish and seafood purchased by expatriates and upper-income Thais who have been exposed to foreign fish Thailand - Seafood

34. Wine is now regularly served at most social functions and being a wine drinker is perceived as a sign of social status. • Wine has achieved a high level of acceptance among Thai consumers, typically aged between 25-55 years. • For beer, Thai drinkers prefer flavour to cost – with preferred beers being from Japan and Germany Thailand – Beer, wine and spirits • Increasing urbanisation, higher consumer disposable income, and a trend towards social drinking have contributed to a demand for cocktail bars, where spirits are in high demand • Because of travels, the internet and social media the younger Thai generation have brought a big demand for imported beer and spirits • The tourism factor brings with it a huge market for beer, wine and spirits across restaurants and hotels

35. Traditionally Thailand has preferred the taste and cheaper price of domestic tropical fruit, however imported fruit is seen as a luxury item, and is rapidly growing in popularity • Recent imports have reflected the changing tastes of Thailand - a huge surge in spending on blueberry and cranberry imports from the USA from US$9,572 in 2011 to US$173,646 in 2013 Thailand - Fruit • Changes in consumer spending patterns, and an increased public awareness have created a demand for fruits from around the world • Huge tourist arrivals mean that imported fruit is a must in order to satisfy demands • Thailand fresh fruit and nut imports increased 120% between 2010-2015

36. The raw milk industry in Thailand has seen an overall CAGR of 5.69% from 2007 to 2013, and a 10.46% increase between 2013 and 2014 alone. • Cheese recorded a growth of 7% value share in 2014 and has remained strong in the last 3 years due to strong popularity of Western cuisine (e.g., sandwiches, hamburgers, pizza, pasta) that requires a high amount of cheese in dishes. • Drinking milk products continued healthy value growth of 7% and volume growth of 6% with a lot of room for the market to grow. • Overall value growth in drinking milk products is anticipated with a 4% CAGR at constant 2014 prices. • Yoghurt is similarly expected to show healthy growth in the coming years. Thailand - Dairy

37. Tea has traditionally been consumed by older people in Thailand, but the target consumer base has become younger and younger and ow covers adults of a working age. This younger audience was not only interested in drinking tea in original flavours, but also in sophisticated teas. There is great interest in trying new varieties. • Off-trade tea sales are expected to grow at a CAGR of 3% at constant 2014 prices reaching Bt3.0 billion in 2019. • Coffee-drinking culture has also increased, especially in the 2014 through both on-trade and off-trade channels. Chained coffee shops, independent cafes, and specialist coffee shops have all increased, with wider variety of products in terms of flavours, packaging formats, and sizes. • Retail sales of coffee are expected to grow at a CAGR of 4% at constant 2014 prices, reaching Bt39.9 billion in 2019. Growth is expected as more Thai consumers are set to enjoy drinking coffee alongside having busier lifestyles. Thailand – Tea and Coffee

38. High growth in the number of hotels, resorts, and other tourist accommodation continues to provide new opportunities for the sale of imported food items • Changing eating habits and Thai lifestyles are fuelling the growth in the restaurant sector and consumers are now eating out more frequently • The increase in the daily minimum wage have provided more disposable income for Thai consumers to try new restaurants • Shopping behaviour has moved away from the traditional open markets to modern supermarkets which offer convenience and choice Thailand - Benefits

39. Facts and Figures Food & Hotel Thailand 2016, Bangkok - 6th to 9th September 2017 Venue: Bangkok International Trade & Exhibition Centre (BITEC), Bangkok, Thailand Show facts - annual exhibition - launched in 1989 - trade only for all 4 days of show - Thailand’s leading show for premium, gourmet, and international product Thailand market information - population of 67 million - ASEAN’s 2nd largest economy - 2.9% GDP growth in 2015, with 4-5% forecast for 2016 - 2015 saw Thailand’s largest ever tourist arrivals of 29.5 million – 19% up on 2014 figures FHT 2016 statistics - 21,000 sqm - 335 companies from 23 countries and regions - 28,000 trade visitors - 10% show growth from 2014 edition - includes Thai International Culinary Cup and ASEAN Culinary Challenge

40. Population of 7 million • GDP per capita that has continued to develop since 2001 despite worldwide recession • Located within 4 hours travel time of: Taiwan, Shenzen, Guangzhou, Manila, Hanoi, Chengdu, Shangai • 10th largest country in the world for total trade, but the 100th largest in terms of population • Significant number of imports are re exported due to Hong Kong’s Central Asia location, free port status and its position as a regional purchasing and distribution centre Hong Kong – Overview • Major import country with over 90% of food supply imported – partly down to varying tastes of Hong Kong, partly down to free port status

41. Largest meat consumer per capita in Asia, and continued growth is forecast up to 2016 and beyond • Hong Kong has traditionally imported the bulk of beef from China. However, younger generations aren’t as interested in working with livestock so production has fallen leading to a shortfall of supply for Hong Kong, this has shifted prices up and caused a need for more imported beef partners Hong Kong – Meat • Hong Kong generally consumes more pork than of any other meat product (beef, poultry etc) • From 2003 to 2013 Hong Kong saw their import of chicken increase by over 100% from 154,000 tonnes to 325,000 tonnes

42. Demand for wine has risen rapidly since all wine import duties were removed in 2008, rising from an import value of US$367 million to US$1.03 billion in 2012 – 183% growth over 4 years • Craft beer is taking off in Hong Kong and imported high quality beers are the key areas of growth (also local growth in Hong Kong breweries to meet demand). Overall beer imports grew 2% in 2015, largely a result of craft beer • Beverages with less than 30 percent alcohol (primarily wines and beer) are not subject to excise duty • Products with an alcohol content of less than 30 percent by volume do not require a license or permit for import, export, manufacture, storage or distribution • Younger population reaching legal drinking age are well travelled and knowledgeable on international drinks, and also interested in new types and flavours of spirits such as vodka, gin, whisky. Hong Kong – Beer, wine and spirits

43. Per capita consumption of fresh fruit and vegetables in Hong Kong is among the highest in the world. However, the openness of the Hong Kong economy contributes to the competitive nature of the fresh produce trade. • Hong Kong has a preference of fresh fruit over frozen fruit, and an increasing demand for organic products that are generally priced 20-40% higher than regular produce – prices can be high but need to reflect the quality of the product • In 2013, fruit and nuts import from Australia were valued at US$163 million, representing 107 per cent growth compared to 2010 – a clear indication of the market potential • The rising health consciousness of Hong Kong’s consumers is set to remain the key driver of the positive performance anticipated in fruit/vegetable juice. Many consumers are becoming more active in terms of trading up to categories such as nectars (25-99% juice), not from concentrate, and 100% juice in search of products with higher juice content and stronger health benefits. Hong Kong – Fruit and Vegetables

44. Increased awareness of healthy living in Hong Kong. As a result, the aging population has become more aware of the benefits of calcium which in turn has boosted cheese consumption. • As with Singapore, Hong Kong are starting to demand high calcium, high protein, low fat and skimmed milk drinks. Consuming dairy for health benefits. • Cheese is expected to register a CAGR of 2%, with growing health consciousness and an aging population as the key drivers over the next 4 or 5 years. • Current key dairy suppliers in Hong Kong include The Netherlands, Australia, and New Zealand. Hong Kong – Dairy

45. Consumer interest in coffee has continued to rise in Hong Kong in 2014, despite it traditionally being a tea-drinking location. • There have been an increasing number of cafes, coffee specialists and premium coffee brands that target the growing group of sophisticated consumers. • Coffee drinking is a sign of international integration, especially among the younger population. • Per capita consumption of tea by total volume in Hong Kong is one of the highest in the Asian Pacific, second only to Japan. • Though the demand for black tea is mature, fruit/herbal and other teas are set to continue to be one of the main growth drivers. Good tastes that make the product easy to drink and be accepted by many consumers is an important factor in their success. Hong Kong – Coffee and Tea

46. With market leading per capita stats for wine, meat and fresh fruit consumption, Hong Kong clearly has a strong growing demand for higher end Western produce • Consumers are receptive to innovative, nutritious and healthy products that can offer additional benefits - being an affluent market, consumers will pay extra for the added benefits or quality • A steady tourism industry, and business people travelling into Hong Kong from across the world means by tapping into Hong Kong there is the opportunity to spread a worldwide brand awareness when people return home • There is already a clear and growing demand for South African wine • Free port status means the cost of exporting goods to Hong Kong is less costly than other nations • The nation is nearly completely dependent on imports – so there is a constant demand Hong Kong – Benefits

47. Facts and Figures HOFEX, Hong Kong 8th – 11th May 2017 Venue: Hong Kong Convention & Exhibition Centre, Hong Kong (SAR) HOFEX 2015 statistics - 16th edition - 65,000 sqm - 2,418 companies from 57 countries - 37 international pavilions - 38,053 trade visitors Show facts - established in 1987 -Biennial show, alternating with FHA - incorporates Meat @ FHC, HOFEX Hospitality Equipment, Prowine Asia

48. Facts and Figures Prowine Asia, Hong Kong, 8 – 11 May 2017 Venue: Hong Kong Convention and Exhibition Centre Asian wine market • Show facts • annual show (switching between HK/Singapore) • 2nd edition at HOFEX 2017 • organised as a partnership between Allworld • and Messe Dusseldorf (Prowein organisers) • Established after success of Prowine • China partnership • FHA/Prowine Asia 2016 forecast statistics • -70,000 sqm • -2,500 companies from 60 countries and regions • -40 international pavilions • -40,000 trade visitors • Demand for wine in Asia is on the rise, with the region generation $28 billion of sales in 2013 • Asia accounted for 48.6% of revenue from spirits sales worldwide, while consuming 61.5% of the total world volume • Southeast Asia sees 7 million new prospective drinkers join the market yearly, with a 13% increase in spending • Asian wine consumption is expected to grow by 22.84% from 2013 to 2017

49. Population of 250 million – the 4th largest in the world • Average GDP per capita growth of 5.6% per year since 2000 • In 2003, the middle class was estimated at 37.6 percent of the total population. By 2010, the middle class had expanded to 56.5 percent. (Middle class is defined a those spending between 2 and 20 USD per day) Indonesia – Overview • 4.87 million tourists visited Indonesia in 2006 and this nearly doubled to 8.8 million in 2013

50. Meat and meat products saw a 16% CAGR over 2007-2012, in line with improving economic conditions and the growing middle-income consumer segment. • In August, cattle import permits increased in response to shortage in domestic supply. • Fish and fish products saw a similar growth (over 14% in the same period), moving with the business environment and household preferences. B2B and households are currently the main buyers of seafood. • Seafood imports amounted to 116,000 tonnes in 2008, valued at $105.7 million. • There is a high preference for frozen fish, accounting for 67% of the import market. This is followed by smoked, dried, or salted fish at 15%. • Average growth rate of imports equates to around 35% per annum, which is underpinned by strong economic growth and increasing urban area consumer incomes. Indonesia – Meat and Seafood