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Nearly half of black-owned wine businesses in South Africa ‘won’t survive the next year’

Nearly half of black-owned wine brands in South Africa believe their businesses won’t be able to survive the next year due to ongoing alcohol bans in the country, according to a Vinpro survey.

A succession of prohibitions on the sale of domestic alcohol is causing “irreparable’ harm” to the Cape’s wine industry and the livelihoods it sustains.

The survey highlighted the precarious situation of black-owned wine farms, many of which rely on tourism to survive.

According to Vinpro’s report, The Impact of Covid-19 on the Wine Value-Chain, 46% of black-owned brands and farms believe that their businesses won’t survive the next year.

“Black-owned brands and farms have worked hard over the years to stay abreast and try to be sustainable in an ever challenging industry,” said Wendy Petersen, operations manager at the South African Wine Industry Transformation Unit (SAWITU).

“The recent ban on alcohol sales has deteriorated this situation and we are unsure if these enterprises will survive the next month. This is devastating to witness as livelihoods of people and families are at risk and the situation is out of their control.”

Daphné Neethling, owner of Paarden Kloof estate in Walker Bay, added that: “PaardenKloof is a 100% black and female-owned wine farm – almost 99% of our sales and income is dependent on the local tourism market.

“Given our fixed operational costs, we will permanently shut down all components of the business from 1 September 2021 if the lockdown continues beyond 11 July 2021.”

A large proportion of the Cape’s wine farms are heavily reliant on domestic wine sales, with Stellenbosch driving exports of premium and super-premium labels.

The South African government has said that the alcohol ban will end on 26 July. However, many in the industry are dreading another extension.

“South Africa is the only country in which liquor sales have been banned with no financial assistance from national government,” said Vinpro’s MD Rico Basson.

“This irrational cycle needs to stop. Government needs to either partially or fully open up our industry or start providing financial assistance to help these hardworking men and women to feed their families,” he added.

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