One of South Africa's leading trade unions has attacked the country's decision to sign a wine and spirits deal with the European Union.

The agreement, signed on Monday, will allow South Africa to export more wine duty free to its biggest market, the EU, as well as receiving more imports from each of the 15 EU countries.

South Africa’s representatives said the move puts money back into the pockets of the country’s producers – it could inject a much needed SAR50 million (€5.07m) into the wine industry.

But The Food and Allied Workers’ Union (FAWU) said the move is anything but beneficial for South Africa’s wine market. William Thomas, the deputy secretary-general of FAWU, told South Africa’s Business Report that the agreement was a betrayal of the industry’s workers.

He said, ‘We have been deprived. This agreement does not signal a victory for workers’. Thomas believes that imports from highly subsidised EU farmers would undercut the prices of locally produced goods, which could lead to job cuts in the domestic wine industry.

FAWU’s criticism comes despite the EU granting a possible €15 million to increase the participation of black South Africans in winemaking.

Meanwhile, European Commission ambassador to South Africa, Michael Lake, regarded the move as a ‘milestone’ in the relationship between the EU and South Africa.

The quota of South African wine exported to the EU is now 43 million litres a year duty free, around 10 million litres more than the current limit. One proviso of the long-awaited agreement, which took seven years to complete, is that South Africa can no longer use names such as port, sherry or grappa on its wines and spirits.

Written by Tom Chippendale31 January 2002