Evolution and Future of the Competitive Advantages of Wine-Producing Countries

This paper discusses international trade prospects of the main wine-producing countries over different time horizons. Our framework is composed of two approaches and aims at renewing and extending the findings of the existing literature on the dynamics of major wine exporters. Firstly, we apply a Porter's diamond analysis in order to disentangle competitive advantages in 16 countries from various features of the global wine market. Then, we assess short- and medium-term prospects from the evolution of past trends. Secondly, we use data from a survey of (57) wine experts as a robustness analysis to complete the prospective dimension over the long term. Compared with previous literature (prior to the Covid and Ukraine shocks), our results show that the international competitiveness of countries has significantly changed over the last five years. France and Italy should maintain their leadership, but Spain and Chile are slipping back, while China could collapse. New Zealand could eventually become a major leader. These results indicate that competitive advantages are very dynamic in the wine industry, despite static natural endowments (excluding climate). Investment incentives and innovation should therefore play a key role in the long term in this sector, which is often presented as being driven by tradition and natural factors.