Why it's cheaper to drink wine outside Kenya

Rahab Mwangi(Left)and Sylvia Karanja(Right)founder liquor library,share light moment during California wines Catalogue Africa tasting tour,on 24th March 2025 at Villa Rosa Kempinski Hotel in Nairobi. [File ,Standard] It is cheaper to drink wine, in South Africa, and elsewhere in the world, but Kenya. Sector players have pegged this on high taxation of wine imports into the country. "The challenges that we face not just Kenya, but in Africa generally, is the high levels of import tax," Greg Guy, the International director of DGB, a South African premium wine and spirits producer and exporter said, "You know, a bottle of wine here is costing you five or six times more than it would in South Africa." With a relatively high excise taxation, it is difficult for a consumer to have a glass of wine or a bottle of wine when compared to a beer or a local spirit, the cost differential is so high. The tax implication has become a thorn for producers seeking customers. Further, high taxes have been associated with driving up smuggling. "The higher the taxes get, the bigger the incentive to smuggle. And it's not good for anybody. Wine can be more affordable if the tariff issues are less," Mr. Guy said. Even so, notable shifts in wine consumption have taken shape in the recent days, growing the sector in leaps and bounds in terms of the diversity of wines available for people, knowledge and also how people enjoy them. "So many Kenyans are very interested in wine. It's not a luxury, but it's sort of becoming a trend. All social gatherings, wine is a must-have lately," Meera Karia, the Director of Business Development at Viva Global Ltd said. Today, a lot of cafes or restaurants nowadays have a dedicated wine list, this according to sommeliers, has a downside- it can be intimidating given the extensive variety. With many hotels and restaurants, popping up in Kenya Wine is taking up good space, and getting quite prominent in the food scene, as restaurants and hotels ask for wine brands than match with their foods driving up sales. Today Kenyans are more accepting and discerning of wine varieties from the colours red, white and rose's. also, the grape varieties that are available from different countries, as well as technical characteristics of wines, such as the acidity level, the sweetness level, whether it is a medium body or a full body. "Kenyan consumers enjoy the sweet wines, but a lot is changing in the wine scene. People love to see organic wines, they want to see less sugar," Meera Karia said. She adds, "during COVID, a lot of home consumption took place. this is where a lot of Kenyans actually experimented drinking different varietals of wine at home". Wine enthusiasts, importers, and the wine community at large convened in Nairobi, for the second Viva Wine Expo after a 5 years' hiatus. The Event attracted a portfolio of over 20 wine brands for exhibition of new wines from different regions, also network with others in the community. At the wake of Covid-19 pandemic, retail sales of wine went up as night life, including bars and restaurants were shut down. This raved up home consumption through retail. "People started experimenting," Ms Meera Karia said. According to Ms. Karia, the goal of winery sector is to get back into the hospitality space post Covid, as Covid came with many new cuisines. As a sector player, Karia notes that taxation, pricing and foreign currency fluctuation is the most urgent issue that needs to be addressed in the hospitality sector. In July, The Government proposed stricter rules on the consumption and retail of alcoholic beverages, a move was gravely criticized as counterproductive and may see job cuts in the alcoholic beverages sector, as well as drive up sales of counterfeited drinks. Viva Global Ltd has said it will in the nation's best interest for the government, stakeholders, all importers, distributors to sit down and have a conversation, that is mutually beneficial for the country. "The proposal will affect retail sales of wine," Ms Karia said projecting that there is a massive opportunity for wine brands as hospitality industry grows. Wanjiru Mureithi, the Founder and director of Winenjiru Exclusives, and president of Sommelier's Association of Kenya, notes that people are more discerning because they travel around the world a lot. "People are now able to ask for the correct wine, and retailers are now able to tell by brand," she said adding that people have professional qualifications now and are able also to develop wineries that are very diverse and able to serve the market accordingly. Today, wine segment is still an underdog, with its consumption below the double digits, while beer and whiskey dominates the alcoholic beverage space. Despite notable shifts and growth, the Sommelier says there is still room for growth. The Country currently has 40 active importers bringing wine from traditional wine producing areas and other new areas. "Different styles appeal to different groups of people. We also have a trend for de-alcoholized wine, which is really growing," Ms Mureithi notes that the trend is becoming very popular. She adds Wine expo's are important for sector growth. Wine is considered an aspirational drink, from the economic and social standpoint. Most restaurants sell a glass of wine for Sh700 and upwards, depending on establishment. Retail wine prices in Kenya generally range from approximately Sh1,000 to well over Sh50,000 for a 750ml bottle, with most common varieties falling in the Sh1,500 to Sh4,000 range. Prices vary significantly based on factors like brand origin, vintage, special designations, and retailer. Wine experts have said it costs a bit more because there is technical knowledge to it. This however, highlights that it may not typically appeal to younger generations from the price point and the desire to get high from higher alcohol contents at a more affordable rates. "Wine then won't be the popular drink for younger people because wine has a low alcohol content," she said and reiterated the importance of responsible drinking. "People who consume wine consume it more responsibly because typically a bottle of wine is shared. Wine is typically taken with food, making it more responsible," Ms. Mureithi said. According to Greg Guy, the International director of DGB, a South African premium wine and spirits producer, Kenya is their number one African export market. He notes that the Kenyan wine market has evolved both in size and players. "When I first came here, there was probably four or five importers only. There's more wines available for consumption here than a market like South Africa, globally," the wine exporter said. He adds that as a producer it a challenge to educate consumers who are bombarded by a wide selection, "wine is a confusing product. It's not easy. It's not simple". Wine is typically a European product. So markets that have had a large expatriate community have typically been the largest wine consuming markets. And Kenya, Nairobi being a home to many UN embassies, made it a primary target market. Even so, this is not without challenges for producers. Beyond expatriates, producers have been burdened with the challenge of reaching driving consumption to local people. "Expatriates have been our primary markets. Now I realize that that's a limited market. If you want to grow, you need to have your wine available to everyone," Guy said. Based on data, francophone countries, have a higher wine consumption per capita than countries that were colonized by the British countries. "Kenya has very knowledgeable, very educated people who want to learn, and taste wine. Wine is a healthy, natural product," he said adding that it would appeal to Gen-Zs and Millennials who do not want to drink more. The wine producer notes that younger generations in Kenya consumer more sweater wine, "but as you mature, you start drinking drier and then more premium and more expensive wines". The wine producer says that typically older generations drink more wines. "If you look in Western economies, the Gen Z's do not prefer wine, millennials are drinking a lot wine. The baby boomers are dying". Drinking patterns in Africa and emerging markets have not been clearly cut, presenting an opportunity for investment. Benjamin De Vidtz, wine exporter from Chile, and export manager Concha Y Toro, says that sweet wines are targeted at new customers, because it is easier to taste. "People can drink it more informally, taking out this formality that has been created along the years for wine," the exporter said adding that attracting new consumers is a challenge. According to the exporter, complex wine is for older people or people that have developed their taste. The younger people on the other hand prefer more sweet wines. Official data shows that global wine consumption reached a six-decade low in 2024, a significant decrease attributed to rising inflation, geopolitical tensions, and declining consumer purchasing power. However, the total value of global wine sales increased driven by a strong performance in premium wine, which saw growth in volume.

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