Bid to break impasse over South African wine accord

Date: 07/09/00

SOUTH African trade officials resume talks with their European Commission counterparts this month to try to settle a dispute which has delayed the launch of a wine and spirits accord between Pretoria and the EU.

The deal was due to come into force on 1 September, but its implementation was postponed at the last minute after the South Africans accused the Union of changing the terms of the agreement they had negotiated with the bloc. "What was decided at the last round was not reflected in the text," said one South African official.

The dispute is the latest in a series of problems which have dogged efforts to implement a wide-ranging free trade agreement. The argument over the wine and spirits deal centres largely on the EU's insistence that South Africa must abandon the use of the terms "port" and "sherry" for its products.

Officials said this month's talks would focus on the precise conditions for Pretoria to phase out the use of these terms, as set out in the wine and spirits agreement. South Africa insists that the change should begin at the same time as a 32-million-litre duty-free quota for imports of South African wine is introduced.

But in a letter to South African Trade Minister Alec Erwin, Agriculture Commissioner Franz Fischler has insisted that the opening of the wine quota should be linked to the conclusion of the wine and spirits accord.

The free-trade agreement struck with Pretoria last year came into force on 1 January 2000 and laid down terms for duty-free imports of South African wine.

But the Union argues that the quota can only be opened once the separate wine and spirits agreement, which deals mainly with technical issues relating to wine production, has been concluded.

South African trade officials are due to resume talks with their European counterparts to try to settle a dispute which has delayed the launch of a wine and spirits accord between Pretoria and the EU.