Blog: Olly WehringEurope's wine reform - repercussions for us all?

Olly Wehring | 9 January 2008

The proposed update of Europe’s wine reform, finalised late last year, certainly had a colourful ride in 2007. But it seems the dust has still a way to go before settling.

I received an email earlier this week from James McConalogue, director of The European Foundation, which I’d like to share with you.

 

Dear Sir

Europe has never sufficiently grasped the concept of global markets - for a trading bloc whose whole philosophy is grounded in an exclusive low/no tariff arrangement between a specified number of European states, and thereby excluding states outside the bloc, its new wine reform package is no surprise. It confirms the principled framework of the European Union - that Europeans will trade amongst themselves in a heavily regulated and exclusive manner, at the expense and to the cost of those operating in the global market place. The wine reform will in fact close the markets, not open them up.

Say goodbye to your Californian Blossom Hill! The practice of the Lilliputian Europeans in the EU, asserting tariffs and reducing them in global markets where it thinks fit (previously only major governing statutes of France and the Soviet Union), will, in time, massively threaten the global market for wine. The Commission's guarantee that this package for wine reform will ensure "quality and competitiveness" in the global market place is short-sighted, wrong and wholly anti-competitive for those trading in the global marketplace. The reform has taken the markets from bad to worse - it has converted a hugely subsidised market and made it into an outright protectionist one, making the situation no better for the long-term.

The claims by Jonathan Shaw, a minister at the Department for Environment, Food and Rural Affairs, that "This is good news for UK consumers and producers ..  It will rid the wine regime of its worst features, which discouraged innovation and encouraged surplus production that was disposed of at the European taxpayers' expense" are false statements, which will be proven wrong in the medium future. This reform has closed the market to those outside Europe, and British consumers and producers will suffer as they realise that they are now economically isolated from the rest of the global wine market. It is the best example of Europe's Lilliuptians creating little markets for little Europeans.

Yours sincerely,

 

Any thoughts? Kindly share.


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