SpiritsEurope has urged the South African government to provide a clear and reliable timeline to quickly lift the ban on the sale of alcohol which it has instated amid Covid-19.
South Africa first imposed an outright ban in March and lifted it on 1 June, but reinstituted it in mid-July.
According to SpiritsEurope, the alcohol beverage sector is one of the country’s biggest employers, accounting for more than 1 million direct and indirect jobs.
Smallholder farmers, distilleries, packaging companies and hospitality outlets are all affected by the ban, which the organisation says has ‘dire economic consequences’ for the entire supply and distribution chain.
SpiritsEurope also claims that the ban has given rise to a sharp increase in illicit consumption and trade accompanied by rising criminality rates, while ‘no clear evidence on the efficiency of such a measure in the Covid-19 context is available’.
The organisation says that the ban is being ‘felt’ too among major trading partners such as the European Union (EU), as South Africa is the prime export destination for European spirits in Africa. These exports are said to have amounted to €255 million in 2019.
“The ban rips away all the benefits from the Economic Partnership Agreement between the EU and South Africa at a time when we should actually find ways to deepen our trading relations to support each other’s recovery processes,” said Ulrich Adam, director general of SpiritsEurope.
“Banning sales also means banning imports of European spirits, while South Africa continues to export particularly wine which has 110 million litre quota duty free export into EU under the EPA – contributing to R5.7 billion ($324 million) in net exports earnings for South Africa on alcohol.
“Our member companies operating in South Africa are deeply concerned about the uncertainty of current trading conditions. The lack of clarity on whether and when the ban might be lifted makes business planning impossible. We therefore need a clear and reliable timeline.”
SpiritsEurope says that it urges the European Commission to foster a dialogue with the country’s government on this issue.
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