JOHANNESBURG—South Africa’s $1.5 billion wine industry is reeling after a series of pandemic-induced shocks, including successive bans on the sale of alcohol totaling some 14 weeks.
The country’s Chardonnays and Cabernet Sauvignons have become household staples world-wide, and wineries centered in the rolling farmlands around the Western Cape are among South Africa’s most successful and lucrative industries. As alcohol sales resumed nationwide this week, many of these businesses have emerged battered, and some might not survive.
The wine industry in South Africa—the world’s eighth largest producer and exporter—employs about 290,000 people, while the broader liquor industry accounts for roughly 1 million jobs. Liquor sales and taxes typically account for about 3% of South Africa’s $351 billion economy and 10% of its total tax revenue, according to the South African Liquor Brand Owners Association, which represents manufacturers and distributors in the liquor industry.
But the measures taken by the ruling African National Congress government to halt the spread of the coronavirus have dealt twin blows: two bans on booze sales—along with shorter bans on wine exports—and the closing of South Africa’s borders, since the wine industry’s revenue is closely intertwined with tourism.
Wines of South Africa, an industry organization that promotes the nation’s wines in international markets, estimates the industry has lost in excess of 7 billion South African rand ($406 million) in revenue and roughly 21,000 jobs. VinPro, an industry group that represents South African wine producers, cellars and stakeholders, expects more than 80 wineries and 350 wine-grape producers to go out of business.
August 22, 2020 at 04:30PM
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As South Africa Lifts Ban on Wine Sales, Many Vintners Fear It’s Too Late - The Wall Street Journal
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