Wine wood barrels are lined up to be transported at Palmela's cellars on the outskirts of Lisbon September 26, 2008. (Ruters/Jose Manuel Ribeiro)

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"It's Portugal. Don't they drink Port in Lisbon?" I ask.

"One would think so," replies Lisbon resident Frederico Arouca. "But it's mostly older people, and not that much." Occasionally, he explains, it's found mixed into cocktails in a bid to appeal to a younger crowd.

So what do they drink in Lisbon, if not Port? According to Arouca, CEO of Lisbon aD School, wine is the top tipple, particularly the locally produced Moscatel de Setubal, "considered the best moscatel in the world."

Certainly, there's no shortage of places to enjoy a glass of wine in Lisbon, ranging from cosy, hole-in-the wall establishments secreted within winding alleys to upscale restaurants by the water.

Located at the edge of the continent, ocean and river views abound. Le Chat is at the top of Arouca's recommendations for enjoying the waterside views with a drink in hand (including a "Porto Tonico" if so desired).

For business meetings amid the "trendy chic," head to Bica do Sapato, located two metres from the river (and co-owned by actor John Malkovich). Meanwhile, Guilty (Rua Barata Salgueiro, 28 - Avenida da Liberdade), owned by famed Portuguese chef Olivier Costa is "the restaurant of the moment, where people end the night dancing."

For Fado, the soundtrack of the region, Arouca recommends the Bairro Alto area, "where every other door is a bar or restaurant." Tiny beer hall A Tasca do Chico (39 Rua Diario de Noticias) is his pick here.

However, those who prefer distilled spirits may enjoy Ginjina or Ginja, a Morello cherry liqueur typically served in a short glass with a piece of fruit in the bottom of the cup. The spirit is so beloved by locals that the ultimate compliment for a tasty treat is the accolade "Sabe que nem ginjas" (It tastes like ginja).