The European Commission has announced it will spend EUR450m (US$567m) on upgrading EU vineyard production during 2006-7.

The Commission hopes to help EU wine producers fend off New World competitors. The money will go on varietal conversion, relocating vineyards and improving vineyard management, although not routine replanting.

Noting these payments fell outside the ongoing reform debates about the EU wine market system, EU Agriculture Commissioner Mariann Fischer Boel said: "Improving the quality of the wine we produce is a top priority."

Spain will command the largest amounts of cash with EUR159m being spent on the country's wine industry.

France, Italy, Portugal and Germany are the next biggest beneficiaries of the EU aid, while smaller amounts will go to countries including Hungary, Greece and Austria.