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Imports of spirits jump seven year high in a pandemic year

By Dominic Omondi | Dec 29th 2021 | 4 min read
By Dominic Omondi | December 29th 2021

The quantity of imported hard liquor jumped to 16.3 million litres in 2020. [Courtesy]

Imports of brandy, gin, whiskey and rum increased by 45 per cent at the height of the Covid-19 pandemic. This is the highest jump in seven years.

Data from the Kenya National Bureau of Statistics (KNBS) shows the quantity of imported hard liquor jumped to 16.3 million litres in 2020, compared to 11.2 million litres of spirits that Kenyans brought into the country from overseas in the previous year.

This was at a period when the purchasing power of more Kenyans was eroded by the negative effects of the Covid-19 pandemic, with millions of people losing their livelihoods.

This is also the highest jump in imports of spirits since 2013 when there was an increase of 72 per cent in hard liquor purchased from outside the country.

Increased importation of the expensive hard liquor reflects not only the changing consumer tastes and preferences among imbibers as their purchasing power has gone up but also a dramatic shift in drinking habits during a pandemic period that was characterised by economic hardships.

Renowned Psychiatrist Dr Frank Njenga noted that the World Health Organisation (WHO) released a report in May 2020 that indicated that the rate of alcohol use disorders and alcoholism would go up. This was at the beginning of the pandemic.

Anytime there is a social disruption, Njenga said there is a tendency for people to abuse alcohol.

Psychiatrist Dr Frank Njenga in Kisumu, October 2021. [Collins Oduor, Standard]

The Kenya Association of Hotel Keepers and Caterers Chief Executive Mike Macharia said while there has not been a marked shift in drinking patterns by patrons who frequent hotels and restaurants, the surge could be observed in pubs where people drink for longer hours.

“For us, our consumption patterns are still the same. That increase is probably being realised elsewhere-probably in pubs and these off-license wine shops that have popped up all over the country,” said Macharia.

Last year, the economy contracted by 0.3 per cent due to the negative effects of the Covid-19 pandemic, which crippled certain sectors such as hotel and tourism with thousands of workers being laid off.

With pubs either closed or operating fewer hours at the height of Covid-19, there was an uptick in wines and spirits shops around the country.

Consumption of spirits also seems to have benefited from the downturn in beer sales due to the closure of bars and significant increases in prices per unit of beer last year, according to a report by Euromonitor International.

Products such as Gilbey’s Gin sold by the East African Breweries Ltd (EABL) was a major beneficiary of these restrictions, translating to the emergence of what some have described as the Gin Revolution.

Analysts attribute the prodigious consumption of spirits to a growing middle class with a taste for finer things, including whiskey and rum, improved earnings as well as a lifestyle change.

Importation of beer, on the other end, has been declining.

Even before the pandemic, the flow of premium beer - normally packaged in slim green bottles or cans - from countries such as the Netherlands (famous for Heineken) and Denmark (the home of Carlsberg) had alarmingly been reducing to a trickle.

Even as the shipment of beer into the country declined, there has been a substantial increase in imports of hard liquor in the last 10 years to 2020, pointing to a change in taste and preferences among Kenyan imbibers.

This is as the green revolution gives way to the gin revolution. Unlike beer, which is mostly made in Kenya, a good number of the spirits brands are imported.

A good number of spirits brands are imported. [Courtesy]

The leading source of hard liquor is the United Kingdom, the home of Scotch whiskey, where Kenya got more than a third of its spirits in 2019, according to data from the Observatory of Economic Complexity (OEC), the world's leading data visualisation tool for international trade data.

It is followed by the United Arab Emirates (UAE) at 12.9 per cent and Tanzania (12.2 per cent). Tanzania is the source of a Konyagi, a popular low-end rum whose consumption in Kenya has grown in leaps and bounds since 2011.

The litres of spirits imported into the country since 2010 have increased more than ten-fold - from 1.93 million litres to 16.3 million litres in 20202, data from the national statistician shows.

The country’s expenditure on imported hard liquor - whiskey, gin, vodka, brandy, tequila and rum - increased more than four-fold in the last decade to hit Sh5.3 billion in 2019 before declining to Sh5.04 billion last year.

However, the value of imported beer seems to have peaked at $12.4 million (Sh1.09 billion) in 2014 before it nose-dived to a decade-low of $7.92 million (Sh818.9 million).

It then staggered up to stand at $8.9 million (Sh907.8 million) two years ago. The increase in sales of spirits has also been a boon to the taxman.

The State’s revenues from excise duty levied on wines and spirits increased by a blistering 726 per cent between 2011 and last year, according to official data.

In 2011, the taxman only collected Sh2.16 billion from wines and spirits, but this shot up to Sh15.7 billion by the end of 2020.

However, excise duty on beer has increased by only 32.2 per cent - from Sh14.45 billion in the financial year ending June 2011 to Sh19.11 billion in June 2020.

Excise duty collected from wines and spirits last year was a drop of more than a third from the Sh27.8 billion that the taxman got in the previous fiscal year.

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