(TDB) - Swellfun, the Chinese subsidiary of drinks giant Diageo, has reportedly postponed work on a £237 million construction project to build a liquor-producing industrial park in Chengdu.

News reports in China claim that a company spokesperson from Swellfun, a spirits producer taken over by Diageo in 2013, has confirmed that plans for “Chinese liquor brand industrial park” have been shelved.

The drinks business has contacted Diageo for confirmation.

If true, this setback for Diageo would be the latest symptom of the Chinese economic slowdown and the country’s restrictions on expensive gift-giving, both of which have hit the world’s largest spirits producer hard.

With a focus on emerging markets, Diageo has poured investment into Asia, especially China and India – investment that is yet to fully reap any benefits.

In its latest financial results announcement in April, Diageo revealed that organic sales in the Asia-Pacific region fell by 6% in the first quarter of 2015.

In 2014, Diageo’s sales in the Chinese market tumbled by 14%, and its flagship category, Scotch, declined by 22% in the six months to 31 December 2014, despite its blockbuster Haig Club release in November.