Beer Monopoly





  International Reports







Posted November 2010

If only there was more of Africa

African beer market | The Republic of South Africa, prominently projected as a rainbow nation throughout the world football season, has done Africa proud. From the comfort of my living room I watched many of the Football World Cup matches. Not that I am a soccer fan. I just wanted to see for myself the century held presumptions and stereotypes about Africa dispersed. Jubilant African soccer fans put the prejudice to rest that the continent is all about woes, worries and what nots. And if it took the damned vuvuzelas’ incessant, monotonous, droning moan, which had millions of viewers and even players screaming for a little peace and quiet, to blast any remnant prejudgment out of our minds, so be it. Yes, Africa can. Now let them have a beer to that.

The brouhaha over the Football World Cup could almost make us forget that 2010 was a momentous year for the whole of the African continent. Older readers will remember that fifty years ago, between January and December 1960, 17 sub-Saharan African nations, from Mauritania to Madagascar, gained independence from their former European colonists. Many have had a tumultuous time since independence. Many fledgling states experienced civil war, natural disaster, famine, tribal rivalry and even genocide. Many have got to the brink of collapse. Seven of the world's top 10 “failed states” are in Africa: Somalia, Chad, Sudan, Zimbabwe, the Democratic Republic of Congo, the Central African Republic and Guinea. They are “a sadly familiar bunch” says the Fund for Peace, based in Washington, DC, the publisher of the index.

Even those blessed with oil wealth have struggled. Africa's most populous country, Nigeria (150 million people) is among the 10 biggest exporters of oil globally and the largest oil producer in Africa. Since oil was discovered off Nigeria's coast in the 1970s, it has become a major source of wealth. Oil accounts for 90 percent of Nigeria's exports and over 80 percent of government revenue.

But these oil riches have not been accompanied by food security for the majority of the country's population, reminds the prestigious Pulitzer Center on Crisis Reporting, Washington, DC.

No wonder many Africans question what exactly they should have been celebrating given the lack of progress post independence. Indeed, the notion of independence itself — in a context of bad governance, economic inequality, poverty and dependence on foreign aid — has been called into question by some African intellectuals.

Over the past 50 years about USD 1 trillion of development-related aid has been transferred from rich countries to Africa, estimates the UN. Yet real per-capita income today is lower than it was in the 1970s, and more than 50 percent of the population live on less than a dollar a day, a figure that has nearly doubled in two decades. Even after the debt-relief campaigns in the 1990s, African countries still pay close to USD 20 billion in debt repayments per annum, a stark reminder that aid is not free.


“Something new always comes out of Africa”

(Pliny the Elder, 77AD)

All of the above should give Africa’s brewers reason to cry into their beers, had they not a different story to tell. The economic landscape of Africa has changed dramatically since the “dismal decade” of the 1990s, when Africa’s economy spluttered and GDP growth trailed the world’s by a wide margin. Perhaps South Africa’s former President Thabo Mbeki had the gift of foresight when in 1997 he confidently predicted that the new millennium would coincide with an “African Renaissance”. Actually, lots of glad tidings have come out of Africa this past decade: stagnation has given way to dynamism in a broad swath of African countries; fewer people are living in extreme poverty; child mortality rates have declined while primary school enrolment has increased; more people have gained access to clean water and fewer have died in violent conflicts; over 315 million people began using mobile phones. And many have drunk more beer. 

Between 2000 and 2009 beer consumption has risen 50 percent to 95 million hl (Barth Report). Per capita consumption increase has been less marked but already stands at slightly under 10 litres. The good news is that beer has become available to large segments of the population. Better still, many can afford to trade up to premium brands. As Tom de Man, Heineken’s Regional President Africa & Middle East told analysts a year ago: “A consumer drinks ‘affordable’ beer if he must, but he drinks a higher priced beer if he can!”

I never thought that I would say this, but these past two years as the global economic crisis wore on, global brewers SABMiller and Heineken have both been saved by Africa. Without Africa’s beer volume growth and healthy profits, their balance sheets would have been in worse shape. Take a second to let this sink in. Saved by Africa. It’s true. Even when the economic crisis hit Africa in 2009, GDP growth only temporarily slowed down to 2 percent. This year it picked up again to over 4 percent. Next year it is expected to rise 4.5 percent, faster than Latin America’s, Central Asia’s, Europe’s, or the United States’ said the U.S. Secretary of State, Hillary Clinton, a few months ago. Not bad for a continent that many deemed lost, steeped in perpetual misery and despair.

In fact, all of these numbers tell the story of a continent on the rise. This is a story that needs to be told. What do I say? No, it needs to be shouted from the rooftops accompanied by those deafening vuvuzelas until the message rings in our ears.  

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