July 01, 2007, 18:00
The European Union (EU) is planning a major shake up of its wine industry as South African and other so-called new world wines continue to grow in popularity on the continent.
The EU spends around R5 billion a year to dispose of, store or distil European wine surpluses. The reform proposal includes subsidies to get non-competitive growers out of the market and reviewing the EU's complex rules on wine making and labeling.
European vineyards have always been punted as the worlds best, but over the years wines from South Africa, Australia, the US and South America have been tempting European taste buds. In today's free market economy, the EU is facing an uphill battle to convince people that local is best.
Michael Mann, an EU agriculture spokesperson, says: "It’s perfectly good the South African wine, but we think there are a number of things preventing our producers from being competitive. The labeling rules in Europe are quite frankly rather silly and rather complicated."
Boosting trade
About 85% of South African wine exports go to the EU. Next week, the European Commission will announce a five-year plan to redirect the billions spent on dealing with surpluses into boosting quality and promoting European wine.
Mann says: "What we will do is have a five-year period where we offer these incentives for people to get out of production, and at the end of the five years we will have introduced all the other rules, simpler labeling and new wine making practices."
While South African wines still enjoy pride of place on European shelves, a major shake-up could mean renewed competition.
|
