Putin’s “Champagne” bet will lose its enthusiasm

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In July 1936, with the signature of Joseph Stalin, the political bureau of the Soviet Union adopted the resolution “On the production of Soviet champagne”, and decreed that the proletariat should not miss the most bourgeois drink of all.

“Comrade Stalin is dealing with the greatest of questions relating to the construction of socialism in our country,” said Anastas Mikoyan, then People’s Commissar for Food. “But at the same time, he doesn’t forget the little things.”

Stalin may have left, but the Kremlin’s interest in the bubbles remains. Last week Russian President Vladimir Putin signed a law banning imported bottles from using the term “Champagne”, reserving it only for domestic production. This obliges foreign brands to declare themselves rather “sparkling wine”.

Some representatives of French Champagne producers, who fought for decades to ensure that only wines located in the Champagne region itself could bear the name, were dismayed, calling the decision “outrageous” and calling for a boycott of the shipments. .

But the legendary champagne houses have an interest in letting their anger be suppressed. Putin’s gamble is the latest in a long line of ineffective protectionist trade measures designed to help struggling domestic rivals, or to aid his friends with business interests.

An expensive import substitution program devised after Western sanctions were first imposed on Moscow in response to its 2014 invasion of Crimea has, with few exceptions, failed to create national champions of the technology, with major industries still relying on either Western components or Asian imports instead.

Whenever additional sanctions have been imposed by the EU or the US for actions such as alleged interference in the elections, Russian lawmakers have demanded that the Kremlin respond with more embargoes on Western imports, only to make those calls go away when Russian companies make it clear that they have few. alternatives.

Moscow has in the past considered banning titanium exports, only to realize it would hurt Russian producers more than Western buyers. A similar call to block Western IT companies was hastily withdrawn.

A Russian oligarch told the Financial Times that if the technology providers SAP or Oracle were banned by the Kremlin, its mines, smelters and metallurgy plants would stop functioning as soon as the software that ran them needed an update.

And while Stalin’s order to create a Sovetskoye Shampanskoye was an industrial success, it left a lot to be desired in terms of taste. In place of the French traditional method requiring fermentation in the bottle for at least 15 months, the Soviets developed a 27-day fermentation process in 10,000-liter vats.

These former Soviet state-owned champagne factories are now owned by great magnates. Youri Kovalchuk, a close friend of Putin who has US sanctions against him for being a “personal banker” of the president, controls two producers in occupied Crimea seized by the Russian state. Boris Titov, who serves as Putin’s presidential commissioner for entrepreneurs’ rights, an advisory post, owns sparkling wine producer Abrau-Dyurso.

But what the Kremlin says that needs to be written on the bottle will not change the quality of its contents. Moët Hennessey, who owns brands like Dom Pérignon, knows this as well as Russian champagne drinkers. He ignored Putin’s decision, saying he would briefly halt exports while he added the phrase “sparkling wine” to labels on the backs of his bottles.

Putin has had some success with initiatives to promote domestic alternatives to Western imports. In 2014, it banned European imports of food and agricultural products. Since then, the average quality of Russian cheeses and meats, in particular, has definitely improved.

But champagne is not cream cheese. Sovietskoye Shampamskoye can be enjoyed as a nostalgic tradition at New Years Eve parties in Moscow, but no Russian with functional taste buds will happily trade their Moët for a $ 5 bottle of Kovalchuk’s best semi-sweet sparkling wine.

At last month’s St. Petersburg Forum, the annual gathering of Russia’s political and business elite, the VIP meeting room served Veuve Clicquot and the exclusive party hosted by its main sponsor was lubricated by Krug crates . None of the oligarchs in attendance demanded a glass of Patriotic Splash instead. In Putin’s Russia, all sparkling wines can be equal, but some will always be more equal than others.

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