Monday, January 5, 2009

Window on Eurasia: Could Wine Bridge the Gulf Between Georgia and Russia?

Paul Goble

Vienna, January 5 – Tbilisi is actively seeking to resume the export of wine to the Russian Federation, a step Moscow officials say they are willing to approve but one that they predict on the basis of changed attitudes and price levels will not allow Georgian wines to resume the standing they had with Russians in Soviet times.
Last week, the Georgian ministry of agriculture sent an official appeal, together with samples of its wine, to Russia’s chief medical examiner, with a request that Moscow allow Russian businesses to import and sell Georgian wines, something they have not been allowed to do since 2006 (
According to, this is not the first time the Georgian ministry has made that appeal, but today, Tbilisi hopes for a more positive response given that Gennady Onishchenko, the Russian medical examiner, recently said that there should not be any link between wine sales and politics, if Georgian wines meet Russian health standards.
But if the sale of Georgian wine resumes in Russia, that could nonetheless have political consequences as a confidence building measure that could lead to contacts on other subjects far removed from wine and thus possibly to the restoration of diplomatic ties between Moscow and Tbilisi.
Moscow prohibited the importation of Georgian and Moldovan wines in 2006 ostensibly because it had discovered trace levels of heavy metals and pesticides in the wine. A year later, Chisinau was able to show that it had dealt with those problems and thus was allowed to export its wines to Russia again.
But Georgia has not yet had that chance, a reflection not only of its production methods but also of the difficult politics between the two countries. Nonetheless, Georgians remain vitally interested in reopening the Russian market, given that prior to 2006, it sent up to 80 percent of all its exported wine to its northern neighbor.
Having been shut out of the Russian market, Georgian producers now export to some 42 countries around the world, but total exports for the first 10 months of 2008 were less than a quarter of the total in 2005, when 75 percent or 60 million bottles of Georgian wine were shipped to Russian stores.
Returning to the Russian market now, however, is going to be a challenge for Georgian producers. Not only must they overcome the anti-Georgian attitudes many Russians now have, but they have to deal with declines, driven by the economic crisis, of Russian purchases of imported wines and the relatively higher prices of Georgian wines compared to Moldovan ones.
Maksim Kashirin, the general director of the Simple Wine Importing Company in Moscow, says that Georgian wine is “overpriced” considering its “quality which is different from what it was in Soviet times.” Indeed, he suggested, Georgians are now forced to trade on a reputation which is no longer true.
“In that price category which Georgian wines occupy,” he continued, “much has changed since the introduction of the ban.” Better-quality wines from Europe have entered the Russian marketplace, and Moldovan wines have improved as well, although they have not recovered their earlier market share either.
. By clever marketing, he and other experts on the Russian alcohol market say, Georgian producers “can count on a certain position but not on that which they had earlier.” But regardless of that, the reopening of this sector could lead to the reopening of others in relations between Russia and Georgia – and thus provide one of the few light if not bright areas there now on offer.

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