$500MLN REQUIRED FOR COMPLETE RECONSTRUCTION OF WINE-GROWING IN ARMENIA

ARKA
June 18

About $500mln are required for complete reconstruction of wine-growing
in Armenia, the Chairman of Armenia’s Union of Wine-Makers Avag
Harutiunian said.

Under the long-term development program, the most important is to
take measures against phyloxera that is widely spread everywhere in
the world except the Ararat Valley and Vayots Dzor of Armenia, China,
Chili and Cyprus, he said.

According to Harutiunian, major investors do not come to the Armenian
market as they cannot effect phyloxera risks insurance. Foreign
investors insist on either replacing the grapes in Ararat
Valley with their own grapes (which contain a risk of phyloxera
infection) or replacing the grapes root with the American one
that is phyloxera-resistant (which is forbidden under the Armenian
legislation), he said.

Planting and growing grapes on a hectare will take 5 years and will
cost from 12,000 to 15,000 dollars, Harutiunian said.

He pointed out that under the minimum program about $4mln is needed
for construction of a small winery to produce up to 500,000 bottles
of wine every year ($6mln for a big winery).

Production of good wine is impossible without these investments,
he said.

Armenia can produce good wine costing 4-10 Euros not earlier than in
5-10 years and among wines costing between 15 and 30 Euros it can take
up a niche in some 20-25 years when new vineyards will be developed,
Harutiunian said.