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France: new €70m aid package

The French government has announced a €70m aid package to help struggling wine producers.

The announcement followed a crisis meeting on Monday with leading representatives of the country’s wine sector and the French agriculture minister Dominique Bussereau.

The package covers three main areas: assistance for wine producers in financial difficulty, steps to reduce wine surpluses and ‘measures for the future’. Most of the money promised is in the form of debt alleviation schemes and other financial assistance for wine producers in difficulty.

The ‘measures for the future’ include €3.5m in 2005 to promote sales of French wine abroad, in addition to the €5m allocated for this purpose in 2004.

In the past few years, France has seen a progressive erosion of its share of key export markets, mainly due to New World competition. Figures for 2004 exports are expected to be down again, and France’s internal consumption continues to fall.

M. Bussereau also highlighted the importance of continuing efforts to improve quality, promising to maintain the current levels of subsidies for restructuring vineyards.

He confirmed he would ask the European Commission to open a crisis distillation centre to help dispose of France’s huge wine surplus – estimated at around 2.5m hectolitres (1.6m of it in Bordeaux).

Incentives will be made available to encourage growers in France’s major producing areas such as Bordeaux and the Rhône to uproot their vines.

In the Bordeaux area, only about 150 applications to uproot, representing a mere 200ha, have been made so far in 2004-05. The CIVB want to uproot at least 10,000ha of the region’s least qualitative vines, which is less than 10% of Bordeaux’s total vineyard area.

Written by Rupert Joy

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