Monday, December 6, 2021

Kgalagadi Breweries employees sent home

This applies mainly to those who do not regularly frequent liquor selling outlets or not part of the elbow bending movement; if you do not know ‘Savanna Dry’ then you probably have heard their marketing slogan – “It’s dry, but you can drink it”.

But lately there is some sobering news about this Savanna Dry tagline and its peer competitors in the beer industry: the government prohibits the sale of alcohol in the country.

On June 29 the Botswana government stunned elbow benders, instructing that alcohol should not be sold for an indefinite period in a move which is said to be part of a strategy that seeks to curb the spread of Covid 19 in the country.

However, on Friday, one of the leading beer brewers in the country, Kgalagadi Brewery Limited (KBL), said that the indefinite liquor sale ban has forced it to suspend operations at all its sites from Monday, 9th August 2021. The move is said to be a calculated one by the company to cut on operational costs at a time when it’s earning zero income and no subsidy from government.

KBL said immediately after the announcement of the ban it stopped production at its Francistown and Gaborone Chibuku plants, “due to the nature of the product”. The same halt has now been extended to a majority of its sites across the country.

The suspension of operations, according to KBL has forced the BSE quoted company to instruct some of its employees to ‘stay home’.

“We are now on the 39th day of the alcohol ban, and without line sight of when the ban will be lifted, we cannot continue to produce indefinitely. Therefore, from 9th August employees will be asked to remain at home until further notice”, reads part of the KBL statement circulated on Friday.

The KBL’s decision to shut its operations and send employees home also comes hardly three days after the brewer tried its luck at the Gaborone High Court to force the government to lift the ban. The court through three Judges – Tshepo Motswagole, Barnabas Nyamadzabo and Godfrey Radijeng however ruled in favour of government at an early stage of the case which was to determine its urgency.

Following the Tuesday court ruling, KBL issued a statement in which it expressed disappointment and assured its key stakeholders that other options will be explored.

On Friday the company said that it will continue in its efforts to engage government, “on this critical issue which has had a devastating impact on the 50, 000 and 200, 000 livelihoods represented in the industry”.

The on-going ban on sale means the multi-billion-pula lucrative liquor industry’s recovery from a decade of restrained growth has been put on hold once again.

Since 2020 the industry has not just lot money, but also lost employees along the dry journey as three leading liquor manufacturers KBL, Okavango Craft Brewery and Big Sip Company cumulatively had their employment headcount going down by atleast 190.

Before the restriction the investment level of the country’s three liquor manufacturing companies stood at a cumulative figure of about P3.6 billion.

As at March 2020, Botswana had a record 4 893 licensed liquor outlets with an estimated employment level of 15 910. Further, the country also had 1191 Restaurants that employed 23 820 people. The numbers are however expected to radically go down as no one is certain as to how long the liquor taps will be allowed to run dry.

“We are painfully aware of the impact this will have on our employees and the overall supply chain, whose livelihoods depend on industry, and request their understanding”, reads part of the KBL statement issued on Friday.

The government’s on and off restrictions are expected to weaken the local liquor industry which was recovering from the alcohol levy, which steadily rose over the years until it hit 55 percent in 2018.

RELATED STORIES

Read this week's paper