According to wine industry organisation, Vinpro, many SMMEs in the wine business have suffered severe damage and had to shed thousands of jobs. Rebuilding the battered sector would require short, medium, and long-term interventions that needed government support
Vinpro managing director Rico Basson called on the state to create an enabling environment that could help rebuild the sector. Basson believed that this could be achieved through sound policy decisions, infrastructure investment, financial support and relief, and stricter handling of the illicit trade in wine. “The wine industry plays an important role in the agricultural sector, contributing R55 billion to the GDP and supporting 269,096 employees in the total value chain,” he said.
“Now is the time for conducive policy decisions that will create an enabling environment to achieve this growth,” Basson said Vinpro hoped that that wine industry and how it would be helped would be mentioned in the government’s Medium Term Budget Policy Statement this week. “The wine industry, unlike the larger agricultural sector that has performed relatively well over the past year due to favourable climatic conditions and the absence of Covid-19 restrictions, is currently faced with its own unique obstacles due to an economic downturn and more notably the significant impact of alcohol restrictions since the start of the pandemic,” he said.
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Basson also pointed out that the illegal trade in wine, which was one of the unintended consequences of the repeated lockdowns and restrictions, had led to devastating economic consequences. He called on the government to curb what he described as “crisis-driven Covid-19 related prohibitions on wine which have promoted the parallel illicit market” and plunged the wine industry into a financial abyss.
“We want the government to combat illicit alcohol trade and create fair and open competition in the domestic market by enforcing the laws that already exist,” he said. Basson also commented on the impact that the pandemic has had on SMMEs.
“The wine industry has suffered irreparable damage through the Covid-19 pandemic from a large number of small and medium wine businesses, particularly in the wine tourism sector, to wine grape producers and cellars which include several black-owned enterprises with 28,000 jobs already lost,” he said.
Urgent financial support and relief were needed for these businesses to recover. “The wine industry is different from other alcoholic industries not only due to its tourism destinations attracting thousands of local and international visitors to the various wine regions and generating significant revenue for the economy but also because it is a unique asset to the country,” Basson pointed out.
