Following President Cyril Ramaphosa’s announcement of the move to adjusted Alert Level 4 Covid-19 restrictions and the accompanying ban on alcohol sales, the South African Liquor Brandowners Association (Salba) is requesting government to reassess its measures and to focus on its vaccine rollout rather than prohibiting alcohol sales.
The Beer Association of South Africa (Basa) meanwhile, reports that it is seeking legal advice on the “inexplicable” fourth alcohol ban in the interest of protecting jobs and livelihoods.
Salba states that government should implement more effective Covid-19-curbing measures, including addressing its handling of the vaccine rollout, which will have greater success in curbing the sharp rise in infection rates during the third wave – a sentiment shared by Basa.
Inefficiencies in the widespread rollout of the vaccine, the organisation says, are directly compromising the business and economic activity of South Africa and, without implementing a widespread, efficient vaccination programme, there is no possibility of enabling the country to start the long process of economic recovery.
In terms of the alcohol sales prohibition, Salba says such an action will place jobs at risk at a time when the government does not have the fiscal resources to provide support for those workers who find themselves unemployed.
“The [alcohol] industry strongly [asks] the government to explain its decision to enforce a complete ban on alcohol sales for 14 days, despite a lack of evidence to demonstrate its role in driving up current infection rates,” Salba says in a statement.
“Many more businesses will now find themselves on the brink of closure as a result of the latest 14-day ban and no financial relief being made available by government,” Basa says in a statement.
In this regard, association says, the beer industry has even proposed outlets to serve as testing and vaccination sites and for government to use its supply chain to transport vaccines across South Africa.
Salba chairperson Sibani Mngadi states that the organisation has repeatedly taken its proposals to government, most recently through the National Coronavirus Command Council, which it says would help reduce infection rates as well as preserve the economy.
“The ban is being implemented without any consideration of any form of economic relief for businesses and employees of the industries that are being now restricted,” he adds.
The organisation reiterates its contestation that alcohol consumption drives up infection rates, particularly when home consumption purchases have no greater risk than grocery shopping.
Basa reiterates that it has implemented a range of interventions to encourage the moderate, responsible and safe consumption of alcohol and that it is committed to cutting off the supply of alcohol to those caught breaking associated rules.
These interventions include the use of click-and-collect platforms to assist in ensuring the safety of consumers, halting sponsored events that encourage gatherings and enhanced adherence to safety protocols at its outlets.
Along with the broader alcohol industry, Basa has also funded the placement of 500 patrollers and former reservists in 50 police stations across South Africa to support the South African Police Service in enforcing measures.
Nonetheless, Salba says the currently enforced ban will only fuel the growth in the illegal trade of alcohol, which has been proven to increase exponentially when a total ban is imposed.
The illicit trading of alcohol also encourages noncompliance with trading conditions that can lead to irresponsible alcohol consumption and increased health risks.
According to May figures from Euromonitor International that look into the illicit trading of alcoholic drinks in South Africa in 2020, illicit alcohol trade grew at a compound yearly rate of 17% since 2017 and currently stands at 12% of the R177.2-billion total industry market value and 22% of the market by volume and worth R20.5-billion.
Basa maintains that the current curfew should remain in effect and that, together with a ban on gatherings, increased policing and enforcement should be used to protect lives and livelihoods.
North West University business school economist Professor Raymond Parsons, meanwhile, says that although the current increase in Covid-19 infections presented government with “limited options”, it will be the “strict enforcement” by government of existing regulations and the limiting of numbers at risky large venues that also remains essential to turn the tide on the rise in infections.
“These steps should be the major thrust of what is further needed regarding behavioural issues important to coping with the pandemic and not in having to shut the economy down,” he says.
However, coming so soon after the Alert Level 3 lockdown measures were imposed on June 16, cumulatively these new further restrictions could exact a far greater economic toll on certain sectors of the economy, warns Parsons.
In particular, he says, the hospitality, tourism and liquor sectors have now been subjected to new uncertainties and setbacks, which may not end after 14 days.
Hotel and casino group Sun International has announced that it will temporarily close all of its restaurants, casino properties, hotels and resorts.
“The new regulations require our casinos and restaurants to close, but given the new restrictions on leisure travel into and out of Gauteng, alcohol and the curfew, our hotels and resorts will struggle to operate, so we have taken a decision to temporarily close them too.
"We are mindful that government is concerned about the risk of transmission and the need to curtail the rise in new infections. However, these restrictions will have a further negative impact on our tourism industry, the thousands of people employed and the surrounding local communities," Sun International group COO of hospitality Graham Wood says
Although there is a strong general economic rebound under way from last year’s 7% contraction in gross domestic product, the economy remains “brittle”, Parsons says, adding that many businesses, especially small, medium-sized and microenterprises are still especially vulnerable as a result of previous lockdowns and therefore may not survive the latest restrictions.
“A rapid vaccine rollout, which mobilises the private sector on an even larger scale, is the one single thing that could now make the major difference to lives and livelihoods. It then also makes it possible to remove lockdown restrictions sooner rather than later,” says Parsons.
RISK MANAGEMENT CENTRALISATION
Independent business community Sakeliga CEO Piet le Roux says government’s centralisation of risk management in relation to its managing of the Covid-19 pandemic despite “dismal” results from using such a model thus far.
“The vast majority of those who wish to have vaccinations are prevented from doing so because of the restrictions on private sector involvement,” he says.
But after more than a year of “collateral damage”, Le Roux posits that a step-change is required to replace the centralised response with a decentralised response. “This should entail greater decentralisation of risk management, and not stricter lockdowns.”
“For many people, [Alert] Level 4 is not enough, and they will take precautionary measures far in advance of what government instructs,” he says.
However, for many other people, Alert Level 4 is “harmful and needlessly restrictive”, such as those who desperately must put food on the table, or keep their employees employed, or who wish to visit family members whom they may never see again, says Le Roux.
As such, he notes that few things can put the personal safety and social and political stability in a country at such risk as removing food security from millions of people.
“Even as more than 11 000 Covid-19 positive [patients] are now being treated in hospital, with 2 000 in intensive care, 1.4-million people who had a job before lockdown last year are still without employment today,” states Le Roux.
With the new adjusted Alert Level 4 restrictions, he says now unemployed breadwinners, who have likely depleted their savings to put food on the table, are being denied access to the economy.
“Shutting down the restaurant and alcohol industry, yet again, puts millions of people’s incomes and the food security of their families in jeopardy,” says Le Roux.