A significant portion of the French wine industry is facing economic problems - going as far as bankruptcy.

According to an analysis performed by the wine investment specialists of the Rabobank in the Netherlands, a significant sector of the French wine industry is facing a severe crisis. Many businesses are currently not earning sufficient money to secure future requirements, or to attract investors. Howevr, this problem is not only affecting France, but also many wineries in Spain, New Zealand and other parts of the New World, however the conclusion applies particularly to France and Italy. According to the Rabobank analysis, many wine producers are able to survive purely based on their cash flow. As a large part of their investments is already written off, this is sufficient for survival. However, this means that measures aimed at improving quality cannot be financed, which is a threat to future survival. This circumstance means that in many cases the next generation prefers to distance itself from the family business, and investors are not being attracted. A large portion of the producers in the New World, particularly those in California, are in a better position to face the challenges of the future. (WF)