As the South African wine industry celebrates 362 years, the alcohol sector got a reprieve as President Cyril Ramaphosa partially lifted the third alcohol ban on Monday evening, which industry welcomed. Photo: Pixabay
As the South African wine industry celebrates 362 years, the alcohol sector got a reprieve as President Cyril Ramaphosa partially lifted the third alcohol ban on Monday evening, which industry welcomed. Photo: Pixabay

Wine industry welcomes resumption of booze sales

By Given Majola Time of article published Feb 3, 2021

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DURBAN - As the South African wine industry celebrates 362 years, the alcohol sector got a reprieve as President Cyril Ramaphosa partially lifted the third alcohol ban on Monday evening, which industry welcomed.

The President said government was acutely aware these restrictions had negatively affected businesses and threatened jobs in the hospitality, tourism and related industries, hence the restrictions were lifted. Ramaphosa pledged government would work with business and labour in the affected sectors to revive businesses and restore jobs in the immediate and longer term.

He announced the permission of alcohol sales by licensed premises for off-site consumption from Mondays to Thursdays between 10am and 6pm.

Duty-free shops, registered wineries, wine farms, micro-breweries and micro-distilleries are now allowed to sell alcohol for off-site consumption during their normal licensed operating hours. The sale of alcohol by licensed premises for on-site consumption, such as restaurants and taverns, would be permitted throughout the week from 10am to 10pm.

Wine industry body Vinpro said it was pleased wine businesses could trade again. The organisation said it would continue prioritising the industry’s long-term sustainability.

Vinpro managing director Rico Basson said opening up wine sales for home consumption from Monday to Thursday, as well as wine cellars for consumption in restaurants and tasting rooms would help push up revenue to more sustainable levels.

“While we are glad that businesses can once again earn much-needed revenue, a long and difficult road to recovery lies ahead for wine-related businesses and it is even too late for some businesses,” he said.

Vinpro said wine businesses have not been able to earn any income from local wine sales for a total of 20 weeks since March 2020, which led to an overall loss of more than R8 billion in direct sales revenue. This threatened the survival of cellars, wine and grape producers and the livelihoods of 27 000 employees in the wine industry value-chain.

Basson said: “We must first ensure that our industry is not again switched on and off nationwide like a light switch by government, regardless of variation in Covid-19 status in the respective provinces.”

The organisation said it would, therefore, go ahead with the court application launched in the Cape High Court on January 27. Vinpro is asking that the Premier of the Western Cape be given the power to adopt deviations to enable off-and on-consumption sale of liquor in the province. Ultimately, similar relief will be sought in the other provinces.

Basson said they would continue to turn to the government for financial relief to protect the livelihoods of 533 wineries, 2 778 wine grape producers and 269 000 employees in the wine industry value chain.

The South African alcohol industry said the excise tax contribution to the fiscus has declined more than 28 percent from R47bn in 2019/20 to R34bn in 2020/21.

“This R13 billion loss in alcohol tax revenue could have covered the investment needed in the procurement of vaccines and other measures needed to curb the impact of Covid-19,” read the industry statement.

The South African Breweries welcomed the President’s decision to lift the ban and said the third ban had meant a total of 19 weeks in lost sales, since the onset of the lockdown.

“The three bans have had a devastating impact on the beer and broader alcohol value-chain,” the company said

On Tuesday night, South Africa’s wine industry marked its 362 birthday. The industry said the past year has been extremely tough. It encouraged wine-lovers to purchase their favourite wines to celebrate the industry’s birthday.

BUSINESS REPORT

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