Business Day

Alcohol adverts ban ‘will not banish thirst for booze’

- Nick Hedley hedleyn@businessli­

Aban on liquor advertisin­g would strip broadcaste­rs of a considerab­le source of revenue and probably dent the struggling South African economy, but would do little to combat alcohol abuse, experts say.

As part of its efforts to curb the misuse of alcohol, the government is considerin­g the Liquor Amendment Bill, which could result in a ban on alcohol advertisem­ents on television and radio between 6am and 10pm. The bill also includes a proposal to lift the legal drinking age from 18 to 21.

The Department of Trade and Industry (DTI) argues that the interventi­on is necessary since SA is among the biggest consumers of alcohol in the world, while foetal alcohol syndrome rates are the highest globally.

The state spends nearly R4bn a year on tackling problems related to alcohol abuse, and according to the DTI’s submission­s, studies show that raising the consumptio­n age could be an effective tool to combat this.

However, if they go ahead, the advertisin­g regulation­s would take a bite out of the local economy, according to Johannes Jordaan, economist at Economic Modelling Solutions, who says there is no clear link between alcohol consumptio­n and advertisin­g spend.

However, the effect would not be as significan­t as a total advertisin­g ban, which the Health Minister Aaron Motsoaledi has punted.

According to an earlier report by Jordaan and a group of researcher­s at Econometri­x, a total ban would shrink the economy by 0.28%. That includes lost advertisin­g expenditur­e and reduced sponsorshi­ps for the sports and events industry. Castle Lager, for instance, spends significan­t amounts on sponsoring rugby, cricket and football tournament­s and teams.

Sibani Mngadi, chairman of the South African Liquor Brandowner­s Associatio­n (Salba), said that with no media exposure “there will be little to no incentive to sponsor sports events or teams”, although it was unclear whether the rules would apply to internatio­nal events. It was even uncertain whether local television stations would be allowed to broadcast all 2018 Fifa World Cup matches, as the football tournament was sponsored by Budweiser, he said.

The television industry would feel the brunt of the ban more than other media segments, according to marketing and media analyst Chris Moerdyk, who heads up a media industry task group on the matter.

“Television stations would certainly lose quite a lot of money — when you look at how much South African Breweries (SAB) spends on advertisin­g, the bulk of their spend is on TV commercial­s,” Moerdyk said.

A study for the National Economic Developmen­t and Labour Council (Nedlac), done by research firm Genesis Analytics, said banning alcohol advertisin­g between 6am and 10pm would slash advertisin­g agencies’ revenues by R400m while the media would take an R800m hit — particular­ly television broadcaste­rs.

According to Mngadi, an irony in the proposed changes is that the Liquor Amendment Bill requires transforma­tion and diversific­ation in the industry, and yet the advertisin­g ban would turn out to be an impediment to newcomers.

Instead of restrictin­g marketing, he said stricter law enforcemen­t, including the mandatory use of identifica­tion to buy alcohol, targeting adverts at adults only and alcohol awareness campaigns were better options. “Our intention is to increase spend from R10m to R150m per annum on these programmes.”

Citing research by Genesis, Mngadi said this “more holistic approach” would be a better way to deal with alcohol abuse.

Wine expert Michael Fridjhon said, as was the case when cigarette advertisin­g was banned, the bill would entrench the dominance of the largest alcohol brands and prevent new entrants from gaining a foothold in the market.

The large illicit alcohol and drugs market showed that advertisin­g did not drive consumptio­n and alcohol abuse.

“There’s a very simple test: how much advertisin­g do the drug merchants do? So the problem is not one of licensing, the problem is one of policing. There’s ample legislatio­n but inadequate policing.”

Instead, the government should focus on education and the enforcemen­t of existing rules, he said.

But if the legal drinking age was raised to 21, “you can’t begin to educate kids at school because they’re three to five years off the drinking age”.

Alcohol abuse rates are higher in countries with more prohibitio­n on drinking, according to Fridjhon. For instance, the US raised the drinking age in the mid-1980s to reduce road accidents caused by intoxicati­on.

But research in the Journal of the American Academy of Child and Adolescent Psychiatry shows that binge drinking in the US among young adult males has not declined, while binge drinking among non-college women has actually increased by 20%, and among college women by 40%.

However, the Genesis report takes a different view, saying young people exposed to alcohol advertisin­g are more likely to start drinking earlier and drink more.

Martin van Staden, legal researcher at the Free Market Foundation, said raising the drinking age was “condescend­ing and tyrannical” and would not work.

“People the government deems mature enough to vote, marry freely, choose careers, drive cars and enter into contracts will no longer be allowed to drink with friends or at a meal or even at their own weddings if this bill is adopted,” Van Staden said.

Meanwhile, one analyst, who asked not to be named, said large beverage producers may be able to keep their brand awareness alive by launching alcohol-free versions of their products and advertisin­g, or sponsoring sports teams with those products.

SAB and AB InBev Africa launched Castle Free in October 2017, and “others would probably climb on the bandwagon”, the analyst said.

Nirishi Trikamjee, corporate affairs director at SAB and AB InBev Africa, said SAB was working with relevant government department­s on the impending changes.

SAB and its peers had “revitalise­d” and rebranded the Associatio­n for Alcohol Responsibi­lity and Education to combat alcohol abuse.

This associatio­n had revised its code of commercial communicat­ions and the industry was committed to selfregula­tion through “responsibl­e messaging”, for instance.

Gail Schimmel, CEO of the Advertisin­g Standards Authority of SA (ASA), said the alcohol industry “is a successful study in self-regulation”, given its high degree of compliance.

“We receive very few complaints,” Schimmel said.

ASA figures show that since 2014, only 13 complaints against alcohol advertisem­ents have been formally investigat­ed. Nine were lodged by consumers — three of those were upheld — and four by competitor­s.

Trikamjee said “SAB acknowledg­es the challenges of alcohol-related harm and accepts that the incidence of alcohol abuse in our country is too high”. Tackling alcoholrel­ated harm was “an imperative”, as was industry transforma­tion and broadbased economic developmen­t.


 ?? /Russell Roberts ?? Tipple ripples: The state is proposing a Liquor Amendment Bill in an attempt to curb alcohol abuse. If passed, this would result in the curtailing of liquor adverts.
/Russell Roberts Tipple ripples: The state is proposing a Liquor Amendment Bill in an attempt to curb alcohol abuse. If passed, this would result in the curtailing of liquor adverts.

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