This chemical is a muscle relaxant that depresses the central nervous system, relaxing both stress and inhibition. While those are positive things, romantically, it should be noted that in large amounts alcohol inhibits arousal and obstructs orgasm.
A little-known but useful fact about alcohol is that it increases testosterone production: in men the difference is slight, but with the correct doses may quadruple a woman's levels. Testosterone is a key factor in aggression and sex drive. (A woman with fully functioning ovaries produces, on average, three-tenths of one milligram of testosterone per day. Men's bodies produce more than 20 times as much.)
So: in the correct amounts it both increases the amount of and reduces the resistance to one's libido. If that isn't an aphrodisiac, I have no idea what is.
There are social factors involved with alcohol as well, allowing people to drop inhibitions beyond the chemical effect of the drug. A friend of mine has tested this with interesting results. His test is simply to accompany dinner with a very nice nonalcoholic wine.
Note: Women produce smaller amounts than men of a gastric enzyme that helps metabolize alcohol, causing women to be more susceptible to its effects.