EU agrees compromise to curb wine overproduction
A major reform of the EU’s wine subsidies was agreed today, although its full effects are unlikely to be felt for years thanks to compromise deals.
Officials want to reduce overproduction and instil makers with a fresh drive to regain world markets.
The agreement came after a marathon bartering session which itself capped two years of negotiations in which the EU sought a far-reaching liberalisation of a sector where too many unprofitable growers were kept in business.
Under the reform, farmers will be compensated for digging up 5% of vineyards to curb overproduction although the original plan by EU Farm Commissioner Mariann Fischer Boel called for payments to get rid of more than double that amount.
France and Italy objected to several key issues but accepted changes after it was agreed that there would be long transition periods and some leeway to keep state support going.
Mr Fischer Boel also insisted on eliminating the €500m spent on distilling unwanted wine into industrial alcohol and other measures to dispose of wine no one wants to drink. The compromise package foresees a long transition period and still allows for funding of distillation in exceptional circumstances.
Plans to ban the addition of sugar to increase alcohol content, a practice used in northern areas to compensate for the lack of sunshine, were scrapped altogether after opposition from France, Germany, Austria and several central European nations.
Ambitious plans to let profitable wine producers expand their holdings at will to compete better with New World multinationals were delayed until after 2013.
Mr Fischer Boel said the reform was needed to keep Europe in top position.
Top notch wines, including the best claret, burgundies and barolos, remain the envy of the world, but mass-market wines were often overtaken in quality and price by competition from Chile, Australia and South Africa.
