Tavern and shebeen owners have called for the government to lift the ban on the sale of alcohol in seven days or risk collapsing the sector. “The decision by the President and his Cabinet to institute a third ban on alcohol sales on the 28 December 2020, further condemning the alcohol industry to 18 weeks of non-trading since lockdown was implemented … has reduced liquor traders to being mere spectators in the economy they have contributed significantly to over so many decades,” said Lucky Ntimane, convener of the Liquor Traders Council.
Liquor traders employ more than 282,000 people spread across taverns, bottle stores and independent liquor traders, and according to News24, Ntimane said those jobs may be lost if the ban is not lifted within seven days.
“The situation is dire and requires urgent intervention at a level of the President to resolve, the first step of which is allowing the sale of liquor to take hold without delay,” he said.
In a letter sent to President Cyril Ramaphosa by the liquor traders, the group asked for Unemployed Insurance Fund Temporary Employee/Employer Relief support for the traders, financial relief in the form of a R20,000 package and a moratorium on all liquor licence fee renewals including distribution licences.
Ntimane warned the group would do “whatever it takes” to ensure that the industry is reopened, should their plea be ignored.
The Western Cape Government is also pushing for the relaxation of lockdown restrictions, including the opening of beaches, the lifting of the ban on alcohol sales, and a review of the curfew. The DA-led provincial government says, considering the evidence that the Western Cape has passed its peak and the demand on health services is stabilising, there needs to be an urgent reconsideration of the alert level three restrictions that are hurting the economy and resulting in almost daily business closures and jobs losses, reports BusinessLIVE.
“Data from the tourism industry in December unsurprisingly reflect a sector that has been hard hit by the COVID-19 pandemic and the related lockdown restrictions, with almost all the top attractions in the Western Cape reflecting a more than 60% drop in visitors over the peak tourism season (December and January),” Western Cape Finance & Economic Opportunities MEC David Maynier said.
The tourism industry, a major employment driver in the Western Cape, is one of the worst affected sectors after governments across the globe imposed tight movement regulations to curb the spread of COVID-19. So, too, the alcohol industry.
The wine industry, which contributes about R38bn to South Africa’s fiscus and supports 350 000 jobs, is a mainstay of the Western Cape’s economy. The wider alcohol industry, which contributes 3% to GDP and supports roughly 1m jobs, shed 165,000 jobs due to the two prohibitions in 2020.
Already, the country’s largest brewer, SAB, has temporarily suspended the contracts of 550 workers due to the latest ban on liquor sales. Earlier in January, the brewer approached the Western Cape High Court to challenge the constitutionality of the prohibition.
And Western Cape Premier Alan Winde has asked President Cyril Ramaphosa for an urgent meeting of the President's Co-ordinating Council to discuss the lifting of the beach and alcohol sales ban to avoid an ‘economic disaster’ in the province.
According to Winde, the number of COVID-19 cases in the province are declining, and the health facilities are positioned to cope with the current number of cases. His proposals include shortening the curfew, reintroducing Monday to Thursday alcohol sales, on-site alcohol consumption and wine farm alcohol sales on the weekend.
“Throughout this pandemic, we have argued for getting the balance right in saving both lives and jobs … The reality is that the balance is not being achieved currently, and the President needs to use the differentiated approach to help save jobs in the Western Cape and those provinces that have clearly passed their peak.”
Cosatu also called on the government and liquor industry to find a compromise to save jobs. Die Burger quotes Cosatu spokesperson Sizwe Pamla as saying the trade union federation was very concerned about the impact of the decision by the SAB to retrench 550 workers due to the liquor sale ban.
Tyrone Seale, Ramaphosa’s spokesperson, did not commit to any timeframe for the President to review the restrictions or to address the nation. “The government constantly monitors all aspects of the pandemic,” he said.
The Restaurants Association of SA has urged Ramaphosa to lift the 9pm curfew and alcohol sales ban before it results in the irreversible devastation of the industry. According to a Pretoria News report, Wendy Alberts, CEO of the association – alongside a handful of restaurant owners – has begun a sit-in at the Union Buildings, pleading for an audience with the President.
Alberts said they had planned a week-long sit-in to be granted an opportunity to hold an inter-ministerial meeting with the President in order to discuss a workable solution to save the industry immediately by lifting the curfew and allowing the resumption of alcohol sales. She said the restaurant industry was at a critical stage and simply could not continue as it had since the country was moved back to the adjusted level three of the national lockdown on 28 December.
Alberts said even though they had been notified that it would take up to seven to 14 days for the matter to be dealt with, they would instead continue to stage their sit-in as every day lost impacted on more restaurants and livelihoods.
The unintended consequences of an alcohol ban, which include the rapid rise of illicit liquor production and reduced tax revenue, far outweigh the efficacy of a prohibition, BusinessLIVE reports a study backed and paid for by the industry has found. US-based not-for-profit organisation Transnational Alliance to Combat Illicit Trade’s (Tracit) members include AB InBev, the world’s biggest brewer, and Dutch beer maker Heineken.
Tracit, which aims to mitigate the economic and social damage of illicit trade, said emergency restrictions on alcohol production and sales have devastated a legitimate industry, jeopardising long-term employment and growth.
Curbs also fuel a parallel underground market that harms the legal sector’s ability to rebound once restrictions are lifted.
The R140bn liquor industry, which contributes 3% to South Africa's GDP and is responsible for 1m jobs, was dealt a serious blow and left fuming late in December when the government announced an immediate ban on alcohol, saying it was critical to reduce the alcohol-related trauma load on hospitals and free up desperately needed resources for COVID-19 patients amid a surge in infections.
This was the third such ban, after sales were prohibited in March and July.
[link url="https://www.news24.com/fin24/economy/lift-the-alcohol-ban-within-seven-days-or-risk-the-sectors-collapse-say-liquor-traders-20210125"]Full News24 report (Open access)[/link]
[link url="https://www.businesslive.co.za/bd/national/2021-01-25-western-cape-pushes-for-relaxation-of-level-3-lockdown-restrictions/"]Full BusinessLIVE report (Restricted access)[/link]
[link url="https://www.gov.za/speeches/premier-winde-urges-president-ramaphosa-convene-pcc-so-some-restrictions-can-be-relaxed"]Government press release[/link]
[link url="https://www.netwerk24.com/Nuus/Gesondheid/verslap-vlak-3-regulasies-in-w-kaap-vra-winde-20210126"]Full report in Die Burger (Restricted access)[/link]
[link url="https://www.iol.co.za/pretoria-news/news/restaurants-association-of-sa-wants-end-to-curfew-alcohol-ban-d7188619-47c3-4974-a74d-7c3e0077b08c"]Full Pretoria News report (Open access)[/link]
[link url="https://www.businesslive.co.za/bd/national/2021-01-25-booze-ban-losses-far-outweigh-the-benefits-of-a-prohibition-says-study/"]Full BusinessLIVE report (restricted access)[/link]
[link url="https://www.tracit.org/prohibition-paper.html"]Tracit report[/link]