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Wine Reform

DW staff (ot)December 20, 2007

Following a long-running debate about the future of Europe's wine industry, the European Union agreed to major structural reforms aimed at curtailing overproduction and generous subsidies.

White wine being poured into a glass
Germans will be able to continue adding sugar to up their wines' alcohol contentImage: BilderBox

The market reforms agreed to on Wednesday, Dec. 19, come as other wine-producing countries such as Australia and South Africa are gaining a larger slice of the global and European markets.

The reforms would bring "balance to the wine market, phase out wasteful and expensive market intervention measures and allow the [EU] budget to be used for more positive, proactive measures which will boost the competitiveness of European wines," the European Commission said in a statement.

France, Italy, Germany and Spain, Europe's largest wine producers, expressed satisfaction over the compromise agreement which will come into force in August 2008.

Sweet deal

A long shelf holding bottles of wine from around the world
The agreement aims to help Europe's wines compete internationallyImage: dpa

Part of the agreement will allow German and Austrian wine producers to continue to add sugar in order to increase their wines' alcohol content. Ministers from some southern European countries, including France, opposed the measure.

The practice of adding sugar to wine is a century-old tradition used in northern climates that lack the sunshine to develop a sufficient amount of natural sugars that later ferment into alcohol.

Both the German government and German winemakers were positive about the outcome

Germany's Agriculture Minister Horst Seehofer said the compromise "will ensure that the future of our quality wines lies in its variety."

A spokesperson from the German Winemakers Association was more reserved calling the compromise "more light than shadow."

Europe still number one

European wine
Europe remains the world's largest wine producerImage: AP

Europe produces more than 60 percent of the world's wine but over the past decade imports have risen while exports have stagnated.

Part of the agreement will be the abolishment of EU subsidies, a policy that has led to overproduction and to so-called "wine lakes" -- the term used to refer to Europe's vast supply unsold wine.

Instead, the EU will use the money to promote European wines in developing markets such as India and China as well as more traditional markets in the US and Britain.

"Instead of spending much of our budget getting rid of unwanted surpluses, we can now concentrate on taking on our competitors and winning back market share," said Mariann Fischer Boel, Commissioner for Agriculture and Rural Development.