The decision announced by President Cyril Ramaphosa in his national address last night to suspend local liquor sales will deal a devastating blow to the South African wine industry which has already suffered great financial & job losses due to bans earlier in the lockdown. This according to a statement by the wine industry organisation Vinpro, cited below:
View the regulations here, which were Gazetted last night.
Despite continuous engagements with the Department of Trade, Industry and Competition, especially over the past month, the industry was given no warning about the recent ban, nor an opportunity to consult with the National Coronavirus Command Centre (NCCC) before a decision was made and no consideration was given whatsoever to the immediate logistical difficulties it poses for both suppliers, distributors and retailers alike.
It was already estimated that the SA wine industry, which employs around 300 000 people, would lose close to 18 000 jobs and that nearly 80 wineries and 350 wine grape producers would close their businesses in the next year, due to the previous 5 week ban on exports and 9 week ban on domestic wine sales. The industry has also suffered direct losses of close of R3 billion during this time.
Although wine exports may continue, the immediate enforcement of the domestic sales ban will also have other unintended consequences, which include further job losses throughout the value chain, placing hundreds of thousands of livelihoods at risk. The hardest hit will be the significant number of smaller retailers, wine grape producers and wineries.
The SA wine industry is unique in that it is part of agriculture, employs a significant number of people, and is characterised by a large number of small and medium enterprises that are dependent on the domestic market and wine tourism. These businesses will simply not be able to absorb the financial pressures of a further ban.
Despite our shock and dismay at the abrupt decision by Government, we will urgently take up our deliberations with them again with renewed energy – specifically the Department of Trade, Industry and Competition and the Department of Agriculture, Land Reform and Rural Development.
Just in the course of last week, the industry initiated contact with Government to formalise a social compact between industry, Government and civil society. We really hope to continue with this process to find common ground in ways to drive behavioural change regarding the consumption of alcohol without jeopardising the livelihoods of individuals and businesses in the industry.
The wine industry has taken all necessary precautionary steps to ensure safe and responsible trading, while promoting the moderate consumption of alcohol. However, we now need Government to take up its role in policing the regulations, including law enforcement measures to curb illicit trade.
As a matter of urgency, Vinpro is also in the process of gaining clarification on certain practical implications of the current legislation, including the transport and storage of wine and other activities in the wine value-chain. We will communicate this once we have confirmation from the relevant departments, including the Department of Transport.
tel: +27 (0)21 276 0429