EU Ambassador to ZA Marcus Cornaro has confirmed to ZA Confidential that a €15m EU fund for supporting the South African wine industry should soon be available.
ZA Confidential understands the payment, equivalent to over R225m, was part of an earlier Wines and Spirits Agreement between Brussels and Pretoria, which also included the condition that ZA should cease using the terms “port” and “sherry” for its fortified wines.
The Ambassador confirmed that this earlier agreement on alcohol was not ratified, but has now been incorporated into the EU’s new Economic Partnership Agreement (EPA), which was recently signed with ZA and its SADC neighbours.
“We have re-committed the €15m,” he said.
“It is a refreshment of an older commitment.
“The earlier agreement was never ratified.”
The Ambassador said that EU officials are in talks with the Trade and Industry Department (dti) and with the Department of Agriculture on details of how the money will be allocated.
Two thirds of the fund will go to boosting employment and BEE, with the aim of securing a genuine impact on transformation and job creation in the wine industry.
The other third would go to supporting the marketing and promotion efforts of the ZA wine industry. “We are about to finalise the modalities and detailed objectives,” said Cornaro.
The EPA itself is also expected to bring additional benefits to the ZA wine industry, allowing greater access for exports to the European market.
In another development, the Ambassador suggested that with the EPA negotiations having recently been concluded, ZA is in a far more comfortable position in facing the challenges which will arise from the UK’s Brexit vote.
“With the EPA, SA is not a big demander in the equation,” he stated. “Myself and the U.K. High Commissioner will argue that once the landing zone is clearer, and if SA is happy to preserve the EPA, they are starting it from the most comfortable position of the three.” (The three parties he referred to are South Africa, the EU and the UK.)
The Ambassador said that the EU was a massive supporter of ZA’s transformation to a democracy “spending €1bn per decade for first two decades.
“I still get credit over a lot of the support which was received,” he noted.
He said that although EU support for ZA has been reduced to around €250m over 4-5 years, ‘we are in a very healthy partnership relationship, using the money to further leverage reforms.”
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