Moldovan wineries close and diversify to cope with crisis

  • Tuesday 1 August 2006

As the Russian embargo on its wines continues to bite, the Moldovan wine industry is facing crisis.

Wine accounts for 30% of Moldovan exports – and 90 % of that used to go to Russia.

Now, with barrels full of unsaleable Aligoté and Merlot from previous vintages, wineries are closing down and laying off employees.

Russia placed an embargo on wine and other alcoholic drinks from Georgia and Moldova on 27 March. The ban – which has been denounced as illegal, and politically motivated – has caused widespread economic difficulties. Georgia had been exporting 89% of all its wine to Russia.

Russia claimed that wine from Moldova and Georgia was of inferior quality and failed to meet health and safety regulations.

Many winemakers are now desperate. Feodosie Bors, 48, who started his business in 1995 said that he has US$2m tied up in Russia. ‘We hope the Russian market will open again, but that won’t be enough,’ he said.

Another company, Acorex Wine, has hired Irish marketing specialist Ruth Fitzgerald to explore possibilities in Western markets. The company maintains 3,500ha of vines and sold 70% of its 14m bottles to Russia.

At the same time, investment in the Moldovan wine industry continues. Gheorghe Arpentin, who founded the Oenologist Union of Moldovia in 1999, has a strong enough belief in the potential of his country to recently plant 50ha of vines on French rootstock.

'The crisis could be the opportunity for Moldovians to start producing a new type of wine, aimed at an international market,' he said.

Other producers are diversifying into apples and other crops as a safeguard. decanter.com also spoke to 42-year-old Vasili Dragan, who has closed his two Moldovan wineries in the town of Chisinau, and taken all his employees to Russia, where he has a bottling plant and import business.

He expects his imports from Argentina and Chile to double in 2006, to 45m bottles.

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