The real cost of the liquor ban

As the financially bleeding multibillion-rand South African liquor industry continues to reel from the monthlong lockdown, key players – from a family-owned bottle store to giant wine producers – have warned of a jobs bloodbath and destitution.

President Cyril Ramaphosa, who leads the Covid-19 National Command Council, has maintained that the continuation of the liquor ban is in the best interests of the country.

While a R150,000 loss in revenue, incurred by Abineto Shumba of Northrand Liquor Store in Ekurhuleni, may appear insignificant compared to R2 billion wiped out in the country’s wine industry revenue over five weeks, Shumba said his “biggest agony” was how he would face his staff, some of whom had worked for him for years.

“I know that the R150,000 I have so far lost may not be comparable to other big players, but the biggest impact for me has been to deliver the bad news to my employees, some of whom are breadwinners,” he said.

“Due to the lockdown, I have had to make a very painful decision of facing my staff to say I have run out of money to pay them.”

Ramaphosa, who last week declined a request by the Gauteng Liquor Forum for permission to sell alcohol, said his decision followed a consideration of health implications of alcohol consumption and ensuring social distancing was adhered to.

Last year, South Africa raked in R15 billion in tax revenue on the sale of beer, R8.3 billion on wine and other fermented beverages, with sorghum beer bringing in R4.5 billion.

According to Wines of South Africa spokesperson Maryna Calow, despite the industry having been dealt a blow by the liquor prohibition, business would continue to engage government.

“We will continue with our efforts to lobby government to reconsider their views and decisions with regards to the export and sale of wine.

“The industry is working as a collective in the interest of our producers,” she said.

Gerard Holden, chair of Franschhoek Vignerons, said: “Assuming the lockdown continues into May and possibly June, and the ban on both wine exports and domestic sales continues, many businesses of our people will join the lists of the permanently unemployed.

“We estimate that our members collectively employ around 5,000 people in the Franschhoek Valley. If you assume that each employee supports six other people, then 30,000 people are impacted.”

– brians@citizen.co.za

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