New contracts with American megastores hint at better days ahead…
With the value of the forint plunging, increasing debt in the billions and failed negotiations with the International Monetary Fund, it seems that Hungary is on the verge of a Greek-style financial crisis.
So what is a small landlocked country with a population of just over 10.5 million people suppose to do? Surely, there is no easy answer but there is something that Hungary can do to boast its livelihood which involves producing one of the world’s oldest goods.
Many industry experts believe that Hungary could be poised to become a major contender on the international market for wines. This could prove to be a very valuable asset to Hungary’s overall economy. In many instances, wine has helped support a country's growing economy such as in South Africa where it has boosted the national GDP and created a steady stream of employment.
It can also provide diversification, by making a country less reliant on traditional bases, such as agriculture or mining which are subject to commodity price fluctuations. This is particularly significant for rural communities like those in Hungary which make up the majority of the country.
Hungary’s wine culture dates back more than 2,000 years and is accredited with being one of the first countries to implement standards for winemaking.
Today, there are 22 geographically distinct wine regions across the country, which include both indigenous and international grapes varieties. More than 60 percent of total wine production is white, although red wines are growing more popular and their production is increasing. Hungary’s diverse climate as well as its location makes it an ideal place for winemaking.
In 1989 when the Communism regime finally collapsed, Hungary was able to modernize its infrastructure and methods, and attract needed investment for its wine regions. Most notably in Tokaj, where the world famous dessert wine, Tokaji Aszu is produced.
Prominent investors like British wine authority Hugh Johnson helped formed the Royal Tokaji Wine Company, Jean-Michel Arcaute of Chateau Clinet in Bordeaux found Chateau Pajzos, and Spain’s most famous wine estate, Vegas Sicilia established Oremus.
These companies brought tremendous growth into the region even prompting what’s being dubbed as the “Tokaji renaissance.” If Tokaj is any model, the country’s wines can be expected to undergo a major revolution in which Hungary’s future for producing wines is vast. But before this can happen, Hungary must overcome several obstacles. Over forty years of Communist rule which favoured quantity over quality has left the country’s wine industry in shambles. Hungarian wine makers are struggling to recover from the destruction of the past while coping with the changing developments into the future.
There is also a significant lack of marketing and promotional initiatives especially at tapping into more wealthy nations. In North American, most people are not aware of Hungarian wines with Tokaji being the exception. The other regions, though still producing good quality wines, are little known outside of Hungary – testimony to the claims that the country's wines are being under sold.
Hungary produces an average of 3.5 million hectoliters (about 92 million gallons) of wine each year but only about 20 percent of that wine is exported, mostly to other European countries. This is truly unfortunate as so much can be achieved in Hungary’s wine industry with proper leadership and direction.
Wine isn’t Hungary’s only prospect for obtaining economic growth and stability. However, it can lead the way towards what for centuries this nation has been seeking – the ability to be independent and self-sufficient. There is a lot of potential here but it’s up to Hungary to seize it.
Suzanne Urpecz is a freelance writer with a background in culinary arts. She is the creator and editor of “The Hungarian Girl”, a website about Central and Eastern European travel, food, and wine. Illustration: Tyson