Firms cashing in on Covid-19

Firms cashing in on Covid-19

Post was last updated: May 19, 2020


Local producers of alcoholic and non-alcoholic beverages risk closing down if the government does not revisit its implementation plan of measures developed to mitigate the spread of coronavirus pandemic.

Spot checks in border districts of Mchinji, Jenda Trading Centre in Mzimba and Dedza last week showed that foreign businesses have eventually emerged as major winners of the loopholes in Malawi’s implementation plan of the anti-Covid-19 measures.

While the government has put strict measures, there is an increase of smuggled beer into the country.

There is also an influx in entry of bottled beer from neighboring, Mozambique, Zambia and Tanzania.

A bar owner at Mchinji Boma, who asked for anonymity, said vendors use unchartered routes and, in some cases, they are being aided by law enforcing agents.

“Sometimes we use errand boys to go to the other side of the border to buy the beer. But usually, the producers bring us the beers by themselves,” he added.

Emmanuel Nthowa- Nyirenda, owner of Emmanuel Bar at Jenda Rural Growth Centre in Mzimba, said he has closed because there is no supply.

“I don’t believe in selling uncertified beer. So, that is why I have closed the bar until supply local products resumes,” said Nthowa- Nyirenda.

CPL managing director, Gerald Bowler, said it was sad that authorities have failed to develop mechanisms for protecting local company from possible collapse due to influx of foreign beer products.

Bowler said it was disheartening that the measures are coming at a time the company is suffering a trade strain due to escalation of smuggled Chibuku Super and other opaque products from Zambian and an increase in illicit unregulated high alcohol by volume percentage spirit products that have flooded the Malawi market.

“Our companies have been adhering to the measures as set by the Ministry of Health to protect our employees as well as our consumers. So, it is very disheartening that foreign businesses have taken advantage of the situation to make a kill out of our adherence to the measures,” he said.

One of the senior managers at Castel Malawi Limited, Godwin Ng’oma feared that the illegal importation of the beer would fuel further spread of Covid-19 pandemic into the country

Ng’oma challenged the government to take drastic measures to stop further importation of foreign beers to protect Malawians from the pandemic.

“Since these foreign producers use unchartered routes to bring their beer into Malawi, there is no chance for authorities to conduct Covid-19 tests on them. This puts our local bar owners and consumers at risk of contracting the virus in the event that the producers carrying it from their country. That’s why we are urging government to take drastic steps to stop illegal trade lest we render our own measures for fighting the pandemic useless,” he emphasized.

Minister of Trade, Industry and Tourism, Salim Bagus, said restrictions on production of alcoholic and non-alcoholic beverages was a necessary direction to take to protect both employees and consumers from the infection.

But Bagus could not commit on the steps his ministry will do to stop the illegal importation of beers from the bordering countries.

In February this year, Bagus stopped attempts by the country’s revenue collection body – the Malawi Revenue Authority (MRA) – to remove permit requirement on imports of 20 cases or less of alcohol and non-alcoholic beverages.

The minister argued that the waiver was a threat to the local industry. He said he feared that some individuals and the business community could abuse this waiver to their own benefit at the expense of the good of the nation’s revenue collection drive.

“It’s unfortunate that such a waiver was introduced in the first place. It is for this reason that I have instructed the PS [Principal Secretary] to write MRA to stop its implementation because it would not help this country create jobs, but, instead, export jobs to other countries,” he said.

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