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While South Africa is experiencing tough economic times, the Drinks Federation of South Africa (DF-SA) has conducted research to figure out how the alcohol beverage industry contributes to the country’s economy.
The research report, Contribution of the Alcohol Beverage Industry to the Economy of South Africa has revealed that the industry has supported 498,999 jobs.
The report released this year is based on the latest available operational and capital expenditure data from Statistics South Africa (Stats SA) for the beverage industry, trade data, and South African Revenue Service excise.
According to the report, it was conducted to raise awareness of the industry’s value chain and its overall impact, while also encouraging dialogue and collaboration among stakeholders, industry peers, and government regulators.
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“The study aims to quantify the broader economic impact of the legal alcohol beverage industry, including both its direct contribution to the South African economy and the economic multiplier effects working through a complex value chain of backward and forward linkages.”
When it comes to the economic contributions made by industry, the report revealed in 2022, R226,3 billion, or 3.6% was contributed to the country’s Gross domestic product (GDP).
“The alcohol industry generates R215,5 billion in household income, and positively influences the livelihoods of 1.15 million individuals in the country.”
The report also included that the industry’s contribution translates to R96.9 billion in tax, which represents 6.7% of the country’s total tax revenue.
“This amount could finance 470,385 teacher positions or the construction of 131,621 affordable housing units.”
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Dr Shamal Ramesar, head of research at DF-SA says the alcohol value chain therefore supports a range of industries, including agriculture, machinery and packaging, transport, retail, and finance.
He adds that the report underscores the responsibility that the industry holds in shaping the economic landscape of the country.
“We are committed to being a proactive partner and contributing to a prosperous, just, and safer South Africa, while meaningfully contributing to responsible drinking behaviours and outcomes.”
According to Stats SA, income generated by the food and beverages industry decreased by 0,7% in July 2024 compared with July 2023. The stats revealed on Wednesday show the only positive growth rate recorded was for bar sales with 7.5%.
“In July 2024, the negative contributors to the 0,7% year-on-year decrease were catering services and takeaway and fast-food outlets,” reads the report. Stats SA says income from bar sales refers to income from liquor sales.
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