Liquor ad ban ‘won’t work’
A BAN ON LIQUOR ADVERTISING won’t achieve its objectives, but will cause immense harm to the economy. That’s the core message of research conducted by macro-economics consultancy Econometrix for the Association for Responsible Alcohol Use. So far so pretty-much- expected, although the research quantifies the surprising scope of the problem. Banning booze ads would cut gross domestic product by R7bn, lose 12 000 jobs and bring tax revenues down by R1.8bn.
The economic costs of alcohol abuse are also pretty serious: R38bn, or 1.6% of 2009 GDP.
But there’s the other side of the coin. We’re considered only a medium consumption country, based on per capita consumption. Consuming 9.5 litres of pure alcohol a year, we are higher than the African average of 6.2, but lower than Europe’s 12.2.
And get this: 65% of South Africa’s population has never consumed alcohol – among the highest abstention rates in the world. So do we really have a problem when compared with other countries? Econometrix identifies three primary problem areas for attention: South Africans collectively don’t drink all that much, but those who do drink,
really let rip. Based on litres of pure alcohol consumed annually, our adult drinking population is fifth in the world. And we’re champion binge drinkers. Nearly half our drinking population has a binge every week, compared to a global aver- age of only 12%.
Secondly, a quarter of our consumption is unrecorded and sold illegally, beyond the confines of controls or intervention policies, such as increased taxes. So the liquor industry already has the problem that only became serious in tobacco after advertising had been outlawed: contraband.
This illegal consumption may also give the lie to the claim that the incidence of smoking has declined since tobacco advertising was banned. And thirdly, there are high levels of youth drinking here. The report recommends a number of remedial steps.
Misleadingly, Econometrix starts its report with the bald statement that there’s “no statistical relationship between advertising expenditure and alcohol consumption in SA.” This is clearly not true. It’s difficult to imagine an industry spending R4.4bn a year on advertising without any evidence that it works.
What they meant to say was advertising grows in a growth market, but in a mature market like SA’s liquor industry, it grows about as fast as the population. Most of the people who want to drink already do so. It’s a zero-sum game in which one product’s gain i s at the expense of its competitors.
The timing of the report is opportune, at a time when government has shown (in the case of the Licensing of Businesses Bill) that it is capable of giving way to public opinion. Maybe the election has something to do with it.
Give that man a Bell’s. Not.