BRIC Blends

Monday, 17 January, 2011
Neil Pendock
Neil Pendock reflects on how joining BRIC will affect SA wine.
The future of SA wine changed forever in December when China formally invited South Africa to join the BRIC club, the association of fast growing emerging economies. Named after a term coined in 2001 by Jim O'Neill, chairman of Goldman Sachs Asset Management, current BRIC partners will account for 2/3 of global growth by 2014, according to the International Monetary Fund.

Of course the invitation is very much an affirmative action initiative on the part of resource and market hungry China, desperate to broaden its contacts in the Dark Continent. For as O’Neill notes, on the basis of economic prospects, South Korea, Indonesia, Mexico and Turkey all have much better economic cases to make for membership. Even on the Africa continent, SA lags with projected growth this year at 3.5% looking distinctly anemic besides Ghana (10%), Ethiopia (8%), Nigeria (8%) and Angola (7%).

As O’Neill noted "While this is clearly good news for SA, it is not entirely obvious to me why the Bric countries should have agreed to ask SA to join. How can SA be regarded as a big economy? And, by the way, they happen to be struggling as well." The uneducated chickens raised during the last years of Apartheid and confused education policy in the New South Africa are coming home to roost with a vengeance.

But then as the sub-prime saga has confirmed, economics is far from a science. In fact it’s probably a dodgier discipline than wine tasting. But BRIC membership should bring benefits. According to Michael Power of Investec Asset Management writing in the Financial Times last week “in the next decade, the West and Japan will produce only 15 per cent of the world’s growth” which makes a rethink of SA wine exports strategies vital and a BRIC blend inevitable.

The BRIC news sent the rand soaring, for as Marvin Zonis from the University of Chicago told The Times: "It is smart on the part of China to do this and it is also good for SA. It legitimizes SA as a future global power and as an investable country.” Currency appreciation is the last thing struggling SA wine exports need, so ironically, the BRIC news is bad news for SA wine, initially.

Lunching at Voorstrand restaurant on Paternoster beach on New Year’s Day with Great Grapes exporter Marita de Beer who sells 8 million bottles of wine a year, Marita reports that an eastern push will require a re-jig of wine styles. “The Asian palate likes sweetness” remarked Marita “but not necessarily from sugar. In a white blend, Chenin Blanc and Chardonnay could replace Sauvignon Blanc and those high acids and low alcohols beloved of European sommeliers can be relaxed.” Indeed exporters to Angola note that high alcohol levels on a label are used as selling points while the reverse is the case in Europe.

Right on cue comes the award for best New World red to the Niel Joubert Shiraz 2006 at the Fifth China (GuangZhou) International Wine & Spirit Exhibition and the 7th World Famous Wine Festival held in December. With 16.3% alcohol, the wine is a powerful companion to spicy Schezwan diced pork at the Sea Palace Restaurant on Victoria Wharf, Cape Town. Participation in the show by producers like Niel Joubert, Tokara and Simonsvlei was under their own steam as Wosa (Wines of SA, the exporters’ mouthpiece) CEO Su Birch noted in December “WOSA has very limited funds to invest in China.” Something that has to change, going forward.

Global warming will see Russia become a major food supplier according to The Guardian in a survey looking at future trends over the next 25 years as the frozen Siberian steppe warms up for wheat. Russia’s economy is closest in size to SA and with the Fifa Soccer World Cup scheduled for that country in 2018 and in Brazil for 2014, a good place to start for a new BRIC wine initiative might be for SA to share its experiences with the Fundi sommelier training project and other wine marketing initiatives with other club members.

Marita de Beer was the beauty and the brains behind the most successful World Cup wine marketing initiative last year when she brought a coach full of Dutch chefs down to SA in June. One particular dinner at Rust en Vrede with chef David Higgs remains fresh in my memory and it’s surely no accident that David went on to clean up every restaurant award in sight at the end of the year. Perhaps Marita can be persuaded to help SA wine do the same thing for BRICSA.
Marita de Beer
Marita de Beer

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