French government unveils wine rescue plan

By Chris Mercer

- Last updated on GMT

Related tags Nicolas sarkozy Wine France

The French government has launched a multi-million euro rescue plan
for France's ailing wine industry, including €12m export support
and an overhaul of the quality control system.

French Prime Minister Dominique de Villepin said the export fund would help to finance the creation of a new "France" wine brand, as well as encourage winemakers to unite under new marketing schemes.

The government will give a total of €90m in extra funds to its new wine strategy, intended to provide direct relief for wineries in debt and "re-launch" French wine on the competitive world market.

Many French winemakers have faced severe financial pressure over the last year as a result of overproduction, shrinking export markets and falling consumption at home in France.

The deepening crisis has spawned a series of attacks by militant winemakers on foreign wine, sales houses and government buildings in the Languedoc Roussillon region - France's biggest wine region and one of the worst hit by the crisis.

French authorities have spent the last few months working on a strategy to improve the wine sector.

A new national wine committee will be now be set up to implement the strategy.

One of its most important jobs will be to help simplify France's complex quality control system for wine. The country has 450 so-called appellation contrôlée areas, with another 150 vins de pays regions, leaving even French consumers perplexed.

The government said the system needed to be clearer, and backed the development of regional 'appellations' such as Bordeaux or Bourgogne.

Several steps will also be taken to reduce France's wine surplus and help more winemakers convert vineyards, encouraging them to make wine that consumers in fast-growing markets like the UK and US want to drink.

As part of the plan to cut surplus, France has already requested more crisis funds from the European Union this year to turn another two million litres of quality Appellation Contrôlée wine into undrinkable, industrial alcohol.

And, winemakers will rip up 16,000ha of vines, around two per cent of France's total vine area, in order to switch grape types or manage overproduction.

Wine union leaders on Wednesday welcomed the government's strategy, but warned actions must speak louder than words.

Unions in Languedoc Roussillon have vehemently criticised the government for a lack of action over the last year. They estimated in January some winemakers were losing €2,000 per hectare, claiming that mounting debts have even led to suicides in the winemakers' community.

It is widely anticipated that a number of smaller wineries will disappear over the next few years.

Related topics Markets Beer, Wine, Spirits, Cider

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