The beer category supported R71 billion in gross value-added contribution to South Africa’s gross domestic product (GDP), which included R43bn in tax payments to the government, according to an Oxford Economics 2022 report released on Monday.
It is the first local report released to assess the beer industry’s economic impact footprint in South Africa.
The data, which provided the backbone of the Oxford Economics report, was provided by AB InBev (SAB), Carlsberg Group, Heineken, and Molson Coors Beverage Company, as well as data collected by Oxford Economics.
Given its scale and its impact along the value chain, a thriving beer sector is a key ingredient for global economic recovery, the report found.
According to the report, the beer industry represented R1 in every R79 of South Africa’s GDP in 2019. But that is only the tip of the iceberg.
The report found that the South African beer industry contributed around 248 000 jobs to our nation’s economy in 2019.
“At the time of the data collation, this represented 1.5 percent of all jobs or one in every 66 jobs in the country. In Gqeberha, in the Eastern Cape alone, beer accounted for 67 percent of total employment,” it said.
South African Breweries chief executive, Richard Rivett-Carnac, said this is the first time in over a decade that there has been such a comprehensive investigation into the South African beer economy.
“One of the key pillars of our strategy is to grow and lead responsibly – and this report highlights the important role that beer plays in the economic growth in this country.
“To know that every one in 66 jobs generated in the country is from beer inspires me to continue growing the beer category in a responsible manner. This is for the same reason we always say beer is local, inclusive, and natural – the data from the report clearly articulates this,” he said.
Rivett-Carnac said this contribution to the job market is a feat that involves the co-operation of multiple sectors from agriculture to logistics to manufacturing, retail, and more.
“The beer value chain is all-encompassing and drives economic activity at almost every level. It was found that tax revenue generated by beer in 2019 was sitting at around R29bn, which is the equivalent of 2.3 percent of the national tax base.”
Rivett-Carnac believes this report provides an important marker for the industry and for the country’s economic ambitions.
The report estimated that in 2019 alone, South Africa’s four major brewing companies collectively bought R33bn in goods and services from South African companies through their supply chains. Procurement alone was estimated to have supported more than 107 000 jobs and generated R6.6bn in tax revenue.
“From a retailer perspective – which is a big driver of smaller township economies in South Africa – over 42 000 jobs are supported. This meant that for every job at a South African brewer, six jobs were directly created in the downstream value chain,” the report said.
Rivett-Carnac said beer was a very local category.
“As a result, the jobs and taxes that we are able to generate are all from South Africa. This report encourages us to continue to play a meaningful role in our country’s development,” he said.
BUSINESS REPORT