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European Parliament pushes for watered down EU wine reform.

THE EUROPEAN Parliament's agriculture committee is resisting European Commission attempts to overhaul the European Union's (EU) wine market system, notably calling for the retention of compulsory distillation to ease over-production. It has adopted a report written by Greek socialist MEP Katerina Batzeli, who while arguing that the "public storage of alcohol should be abolished," calls for the retention, even expansion, of market-distorting subsidies helping vineyards survive and avoid grubbing up. Indeed the report "rejects the immediate abolition of the distillation mechanism and other market support measures". It says the EU should continue pumping cash into distillation to ease over-production, even retaining "compulsory distillation, which will act as a safety net and allow the gradual reorganisation of the market", while financing "voluntary distillation" to encourage the commercial use of wine alcohol in related products, such as liqueurs and brandies. The committee also agreed that the EU should subsidise alternative uses of alcohol and the vinification by-products, for instance through conversion into biofuels. And it even argues for "a new crisis management mechanism" of grants to be used when the wine sector faces an economic "emergency".

As for grubbing up, the report argued for EU member states to have tough powers to resist calls from Brussels for such production reduction. It stressed: "The issue of permanent abandonment of wine-growing must not be the centrepiece of [wine market] reform." It added that grubbing-up aid should be limited by formulae that stressed the value of vineyards in mountain, coastal and island regions, in fighting soil erosion, maintaining cultural traditions and in other scenarios.
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Author:Nuthall, Keith
Publication:International News
Date:Feb 1, 2007
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