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Following a brief reprieve that allowed the sale of alcohol to resume under advanced alert level 3, President Ramaphosa said domestic alcohol sales would once again be banned in order to free up hospital beds otherwise occupied by those suffering from alcohol-related traumas.

While this did have the intended impact – relieving some of the pressure on the healthcare sector – it has also placed additional strain not only on those in the alcohol manufacturing industry, but also suppliers of goods used to bottle and label the product, and those whose businesses rely heavily on the sale of alcohol, such as restaurants and bottle stores.

The hospitality, restaurant, and alcohol industry has tried everything to come up with a workable plan to reinstate booze sales by protesting, writing open letters, and presenting government with proposals that would regulate the market while still allowing sales.

Experts have also weighed in on the problem with suggestions as to how the ban could be lifted with a reduced impact on the healthcare sector.

Meanwhile, jobs are being lost and businesses are starting to count the cost of the ban, with more companies indicating that plans for expansion and hiring have been put on hold.

One such company is glassmaker Consol, which, according to Moneyweb, is losing roughly R8 million a day in energy costs to keep its furnaces running.

During a Gauteng Growth and Development Agency (GGDA) webinar on Tuesday, titled ‘Resuscitating Gauteng’s manufacturing as a catalyst for growth’, Consol human resources and corporate affairs senior executive Thami Mkhuzangwe said it’s necessary for Consol to keep its furnaces warm because it will take the company 18 to 24 months to get those furnaces back if it takes “the drastic decision of draining and closing” them.

Glass accounts for around 85% of the alcohol industry’s packaging, which means that the ban has led to a drastic decline in sales, bringing about the need to scale down production.

Mkhuzangwe said the industry fully appreciates and understands the reasons that led to the suspension of alcohol sales…However, he stressed that this needs to be balanced to ensure the economy does not suffer and that the glass manufacturing industry, which has invested billions, does not fail.

“If the industry is allowed to fail, it will lead to around R20 billion in deindustrialisation from South Africa”, he said.

Consol CEO Mike Arnold told Business Day that Consol Glass has been forced to suspend construction on a new R1,5 billion glass manufacturing plant in Ekurhuleni, Gauteng, as a result of lost revenue.

“It is clearly a tremendous disappointment and a considerable loss to SA industrial capacity. It was a difficult decision to make, but unavoidable given the significant impact of the pandemic and the second ban on alcohol sales in SA,” said Arnold.

An existing Consol plant in Nigel, southeast of Joburg, was set to add 130 000 tonnes of glass production to Consol Glass’s capacity.

It was expected to create 120 direct jobs, and approximately 2,600 additional employment opportunities across the value chain, from waste pickers to truck drivers, computer numerical control machine operators, glass machine operators, fitters, electricians and additional senior managers.

It’s predicted that if the ban continues, it will place roughly 25 000 direct jobs, and hundreds of thousands of jobs in the glass manufacturing industry’s supply chain, at risk.

Those are jobs that the country desperately needs.

[source:moneyweb&businessday]