After the 1974 revolution Portugal progressed from being an almost entirely economically isolated colonial power with the central power structure to a democracy, and a decade later was a full member of the EU (1975‑1986). This change in course required a fundamental economic change, especially in agriculture.
The situation during the EU accession phase
For a start, public administration in the political proportional representation of this pluralistic society had become bloated because bureaucrats from former colonial administrations returned to Portugal. In the Ministry of Agriculture, the number of staff rose to 25,000. This was made worse by the fact that the private sector adapted very slowly to new market conditions with the continually expanding marketing possibilities because professional and inter‑professional structures with adequately qualified personnel did not exist. The national production structure was therefore under‑developed and because of this most wines initially had very little chance against other wines on the international market. Because exports to the former colonies had come to an end in 1975 and constant decline in national per capita wine consumption had halved the volumes required, there was a huge disparity between supply and demand. As a result, the “garantie de bonne fin” (system of guaranteed distillation, which led to overproduction) had to be set by the EU in the 1990s because it had become the largest budget item. This signalled the need for a new market policy based on consumer‑orientated quality preferences. Thus innovation in all areas of viticulture became imperative. For many large companies, especially cooperatives without their own marketing structure, this marked the beginning of a very difficult period. The total area planted to vineyards was reduced by 40%. At that time, public wine policy was characterised by a surplus of career scientists on the one hand and the defence of the institutional role of direcção geral, and its ministerial administrative bodies on the other. One might almost say that the really promising innovations within the private sector were made contrary to the wishes of and outside of the official administrative structures (such as the national vine breeding network, the RNSV [Rede Nacional da Selecção da Videira]). The formulation of a focussed policy on viticulture was not exactly easy because trade associations abounded in the productive private sector, and the State administration of the wine industry was divided among several different authorities (including the Junta nacional do vinho planning office, the INIA, DCP (A/C/PA), IFADAP, ICEP and MAPA).
Planning for EU accession
Due to lack of experience in democratic government, the political transition led to constant change in the planning goals and the individual people responsible for them. The influence of foreign nations (such as Russia, Germany, Israel and the United States of America) was well‑intentioned but was often associated with self‑interest of one kind or another. Proper economic policy goals were lacking even in the areas of science and research. The lack of all‑encompassing initiatives in viticulture during the first 15 years following the regime change in 1974 led to insurmountable obstacles. At the time of the official declaration of readiness for EC accession in 1984, financing of the first research and innovation projects was granted within the context of a new paradigm: that of a market economy.
In order to create a cohesive set of objectives, the American strategy expert, Professor Michael E Porter (head of the Institute for Strategy and Competitiveness at the Harvard Business School) was commissioned in 1991 to develop a strategic management plan for the Portuguese economy and initiate its implementation. To this end, sectoral working groups (“clusters”) comprising government and economic leaders were established. The most significant outcome was the transfer of responsibility which resulted in economic autonomy via professional and inter‑professional organisations which received State support. A second Cluster under the leadership of Professor Michael Porter was conducted in 2003 to provide impetus the wine sector’s strategy on competitiveness. Unfortunately, the objectives it developed were only partially implemented, since the State, particularly in scientific circles, had its own lofty ambitions. Because of dwindling financial capacity from 2003 onwards owing to the costly backlog of reforms and the coming to an end of EU‑accession funding, there were no longer sufficient resources available to support a market‑oriented innovation policy.
Overall, significant changes were achieved. The most important of these was the transfer of responsibility in relation to agricultural matters, with the number of public sector personnel being reduced from 25,000 to its current 7,000. This has enabled the trade to work in line with market requirements. Progress has been made in education and vocational training and the development of appropriate infrastructures, which were at times planned on too large a scale. More importantly, the integration of the different wine‑related administrative areas into a single vine and wine institute, the IVV (Instituto da Vinha e do Vinho, I.P.) were instrumental in bringing about radical change. The decisive factor, however, was the start‑up finance and administrative assistance provided by trade associations, and the funding for scientific innovation projects, including the necessary infrastructure and specifically, the opening of universities for inter‑institutional cooperation with private enterprise. These initiatives, such as the PEDAP (Plano Específico de Desenvolvimento da Agricultura Portuguesa [Special Plan for the Development of Portuguese Agriculture]) programme, as well as the AGRO and ADI/Agents for Innovation programmes enabled the pursuit of economic objectives through research.
The catalogue of the 327 grapevine varieties cultivated in Portugal, their ampelographic descriptions and synonyms has recently been released. Conservation of these varieties was then centralised in one location. Of the most important grapevine varieties, the largest possible number of different cultivars (over 200 per variety) from all over the country had to be conserved in regional plantations and their yields studied from a statistical standpoint. The legislative basis for the planting of vines, vineyards and wine producers was then amended by the European Commission to take account of the new situation. Significant financial contributions towards new equipment to improve vineyard and cellar technology, and even establish brand‑new wineries made it possible – even if it was painful for many – for the Portuguese wine industry to make international connections.