Miloš MICHLOVSKÝ: “If Georgian winemakers want to be competitive in Europe they must diversify” (watch video or read)

16.05.2024 (Caucasian Journal). Our guest today is Dr. Miloš MICHLOVSKÝ - one of the leading Czech experts in the field of winemaking. He is currently visiting Georgia and kindly agreed to give us an interview.  You may watch the video discussion below, and read the full text - further below.  This interview is also available in Georgian language version.
 ქართულად: Video subtitled in Georgian is here. Georgian text version is here.

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The text version of interview is below:


Alexander KAFFKA, editor-in-chief of CJ: Hello and welcome to Caucasian Journal video interviews! Today it is our pleasure to welcome Dr. Miloš MICHLOVSKÝ - one of the leading Czech experts in the field of winemaking. He is currently visiting Georgia and kindly agreed to give us an interview. We must also thank the Czech Embassy in Tbilisi for this opportunity and for the help in translation. Dr. Michlovský, welcome to Georgia. Is this your first visit to Georgia, and what brings you here?

Miloš MICHLOVSKÝ: I would like to greet by a Moravian greeting “Welcome in the vineyard!” It's not my first time in Georgia. My first visit was in 1970-s during my study and doctorate period. I used to come very often because I had a lot of friends here. In recent years we had bilateral cooperation projects between Czechia and Georgia, as we try to share our best experience regarding EU accession, and actually all the lessons learned.

I see there's a quite dynamic process in Georgia in relation to the EU accession; there have been many changes in legislation. Of course these processes are not easy to be implemented in reality, but they are necessary for the accession to EU.

Georgia can be proud of the qvevri production phenomenon - very old style of wine-making. This is an asset, and added value of the Georgian wine. This asset is definitely something special in the European market, so you have to count on it, but not to rely only on this specific asset. 

By this I don't mean necessarily industrialization of the wine production – not at all. I mean taking care of the vineyards in an organic way. It's not only about producing in old style, as you didn't forget, but please don't forget also about the natural way of harvesting and growing the vineyards.

AK: Your company is focusing on bio, or organic, wine production, is that correct? Can you tell us a bit about your activities and achievements in this field?

MM: I can proudly say that I’m a front runner of the natural production, long before it was imposed by the EU legislation. In contrast to the world's most famous bio wine production methods, my bio production is based on different approach. I am making a new variety of vine, which is more resistant to harmful diseases. So I can use only 2 chemical sprayings instead of 10 or 12. 

This approach actually made me successful and prepared for the EU, because with the accession to EU in 2004, all the wine-makers needed to adjust their production to EU legislation. As I was thinking about the natural production before, I was already ready. 

I think what is very important is diversification of production. With this bio-organic approach we try to find different products to produce: not only wines, but also juices, and other products that are in public demand. We started to produce bio non-alcoholic wines. The non-alcoholic wine is now very trendy in Europe. It's not only for drivers and pregnant women, but it's also a kind of a fancy way of young people to entertain themselves and still be safe. 

There's actually a funny part of it: Some people were suspicious that I'm making ground for future addiction to my wines by teaching young people the flavor of wine, by offering them non-alcoholic drinks.

AK: Do you think the Georgian wine industry should expect the same processes like you had in Czech Republic after joining EU?

MM: Before the accession we were very dependent on getting experience from the EU countries, which they shared willingly with us. So, the same we offer now to Georgia – to share our experiences with you. 

There is a big difference between Czechia and Georgia when it comes to winemaking. We produce 60 to 70 million liters of wine but we consume 200 million liters, whereas Georgia produces much more than it consumes. 

When it comes to legislative and technological preparedness, I think Georgia is on a very good track. What I can see in the wine companies is that technical equipment is on a very high level, and also the EU approximation legislations are in process. 

What will be more challenging, from my point of view, is the export and sales of wine.  I mean the competitiveness of Georgian wine on EU market. You know that within EU there are 2-3 countries that basically can saturate the EU market. They are highly competitive, and are searching for markets outside of European Union. 

If Georgia wants to be competitive in the EU, it will face these big competitors that are already settled on the market and have very good retail prices. There is a big competition of wines coming not only from EU countries but also from South Africa or America. Because we are exporting highly sophisticated technologies for wine-making, they don't pay in cash – they pay by wine. This makes the price very low, and you can easily get good quality wine for €1,5 including tax. So this is quite difficult market situation. It might be challenging for Georgian wines to be competitive. 

Although there were a lot of incentives, for instance preferential bank loans at the beginning, which helped to boost up the wine making sector, now – after 20 years – it’s very difficult for Czech winemakers to compete, for instance, with the Moldovan, South African, or South American imports, because of the prices. So the government helped a lot at the beginning, but now winemakers are struggling to be competitive. 

Maybe you're surprised that I keep talking about competitiveness and prices, but I think this is the most challenging part. I think if Georgian winemakers want to be competitive in European market they have to diversify. They have to think about offering other products that cannot be received from other markets. I would encourage you to take a different approach, and fight with different instruments. 

Back to this hard competitiveness on EU market... As I mentioned, it is nice and convenient that after EU accession there will be access to many subsidies, for technological and financial support for winemaking. This is a positive part of it. But later Georgian wine makers will definitely face challenges connected to competitiveness. I will give you two examples of the Czech situation:

The first is the case of Beaujolais Nouveau, which is a French brand, very trendy in France. It basically flooded all the shops and restaurants in Czechia in November, thanks to a huge French marketing strategy. The reaction of Czechia was very bright, and we were successful because we introduced our Czech brand. We called it “Saint Martin's wine”, and it was released one week before Beaujolais Nouveau. That was a very good marketing step, because we introduced our Saint Martin’s wine to the shops and restaurants before Beaujolais, and we provides the whole story around it, connected to our country. People, of course, trusted more the Czech history and traditions, and started to buy enormously the Saint Martin’s wine instead of Beaujolais. Nowadays nobody buys Beaujolais in Czechia, and this is a marketing victory. But it must be very well-thought, and it's not a marketing step of a winemaker – it should be a marketing step of a country.  

Nowadays nobody buys Beaujolais in Czechia, and this is a marketing victory.

I will give you also an unsuccessful reaction of Czechia, when it comes to Prosecco and other light sparkling wines from Italy. When it came to our market 10 years ago, we drank about 10,000 bottles a year, and now it's 1 million – because of the aggressive Italian marketing. We were not proactive enough to face this massive introduction of Prosecco and sparkling wines. We will have to find our way out of it, because our market is over flooded with Prosecco and these light wines, and we didn't find a way out yet.

AK: If there is if there is anything else you would like to add, the floor is yours.

MM: My recommendation would be to maintain the high quality of the vineyards, of the endemic varieties of wines like Saperavi or Goruli Mtsvane, which will always be competitive. In this case, if you want to keep high quality of wine, you can have less production – like 10 tons per hectare. You don't need to have big massive production, but keep the high quality. While keeping the high quality vineyards in a smaller amount, on the other hand you will have to think about bigger areas with  massive production – let’s say 30 hectares – where the quality will not be that high, but it will be competitive for wine varieties like Prosecco.

80% of world’s consumed wine is at the price of less than €2. So my final recommendation would be – to diversify.

With this, you can compete on the EU market, still maintaining this little part of high quality and expensive wines that will be for the wine lovers, and they will always buy them. But do not base the export only on high quality wines.

Again, talking about the competitiveness, you have to realize that 80% of world’s consumed wine is at the price of less than €2.  So my final recommendation would be – to diversify: You have to keep your original originality, but, thanks to the innovative technologies, also introduce something new: For instance, non-alcoholic wines, or lower-alcohol wines that people might want to drink in a hot summer, or young wines. Try to be more creative in terms of the widening and diversification of the production, offering more products to the public.  This is the only way how Georgia can be competitive, while keeping the high standards of high quality wines.  

To summarize, I would like to say that after 20 years of our presence in EU, there are definitely more positives for the winemaking sector, than the negatives. However, I tried to make you vigilant about the potential challenges that the Georgian winemakers would face in the future, connected especially to the competitiveness in EU market. 

I think now it's the right time to open the eyes, to be more open to new innovative solutions, introduction of new products that could be compatible, and be inspired by other markets – but still keeping the special Georgian input in it. A combination of tradition with innovative solutions, and seeing the actual situation on the market – that’s the combination that would definitely help the Georgian producers.

AK: Thank you for this excellent interview with very important Czech lessons. I'm sure they would be very useful for Georgia. Thank you very much!

Read or watch the Georgian language versions here.  

Caucasian Journal appreciates kind support of the Transition Promotion Program of the Czech Republic and the Embassy of the Czech Republic in Tbilisi in preparation of this interview.

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