Guizhou plans pledge loans to stimulate baijiu market

Southwest China's Guizhou province is preparing to explore pledge loans for baijiu brands as part of a new push to boost its spirits market, the provincial commerce department said in a Tuesday announcement. A policy draft has been released for public comment.

A pledge loan allows a company to use movable assets or legal rights as collateral when borrowing from a financial institution. The lender supervises the pledged assets during the loan term, and the borrower reclaims them after repaying the loan.

In this case, baijiu brands will be able to use base liquor or finished bottles as collateral, according to an investment manager surnamed Liu. He explained that a third-party agency would appraise the stock by vintage, aroma, and storage conditions. A financial institution would then lend against that evaluation.

Liu is confident the policy will succeed, saying it would ease funding pressure created by long production cycles, expand investment products, and give investors more choices.

Baijiu is a pillar of Guizhou's economy. The province is home to famous brands such as Kweichow Moutai. The new policy is the latest effort to support the industry, which has come under growing pressure.

Citing third-party data, CNR News reported that in the first three quarters of 2025, the combined operating revenue of 20 A-share baijiu companies was nearly 320 billion yuan ($45 billion), a year-on-year decline of 5.9 percent. Demand for festival-season baijiu fell by 20 to 30 percent in some cases.

In June 2024, the province implemented a plan to shift from selling liquor to selling a lifestyle. On Dec 5 this year, local authorities began issuing baijiu consumption subsidies of up to 500 yuan.

This year's draft measures also propose tougher action against counterfeiting, market infringement, and false advertising in the baijiu market. It encourages synergizing the industry with tourism by allowing tourists to use tickets for planes, high-speed rails, and scenic spots for discounts on the spirit.

Baijiu is a clear grain liquor that ranges from 40 to 60 percent alcohol by volume. It is commonly consumed at formal events, like weddings and holiday gatherings.