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The dominant wine producing countries in Europe all belong to the European Union and the most significant regions are located in Western Europe. While some Eastern European countries like Hungary have traditionally been major producers in their region, declined interest in and marketing of domestic wines in addition to overproduction has lead to their demise. And their accession to the EU has only emphasized their struggle due to the accessibility of wines in other EU nations and overseas – in the early 1990s there were roughly 106,000 hectares of vineyards in Hungary, whereas only 93,000 were registered in 2004. The economies of countries like France, Italy, and Spain are somewhat dependent on the wine industry that they are used to controlling. The recent emergence of New World producers, however, has sent the governments of some of the better-established countries into a panic. These countries are required to follow strict rules imposed by the European Union. The legislation concerning labeling requires that each label state the “country of origin, the alcoholic strength by volume, the capacity of the bottle, the region of origin or grape variety/blend used and the quality of the wine.” Additionally, the EU mandated that no new vineyards could be planted until 2010 in order to eliminate excess supply. This was amended in 1998 to allow the planting of vineyards in areas where grapes were not in excess supply. Under EU regulations, tariffs on trade between member states are minimal while those with nonmembers remain high. This legislation has clearly frustrated many New World producers, who contest that the EU’s protective approach creates a trade barrier. While the wine market share held by European Old World producers has decreased in large part due to a trend moving away from daily consumption to occasional social drinking and a growing preference for alternatives like flavored alcoholic beverages, these regions nonetheless continue to hold significant power. Reasons for success: - Many of the countries in this region have long established ties to winemaking. Centuries of traditions make the industry not only important economically, but also culturally.
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