Ethiopia: The battle of the brewers

Colonialism’s market share

Despite the sun setting on colonial empires decades ago, whether a country was colonised or not can still have market impact today, for ex-colonies often adopted and retained the drinking habits of colonial overseers. Hence in India, whisky is king, a legacy of British rule.

Ethiopia, on the other hand, never experienced complete colonisation: its beverage market is wide open, ready to be shaped (although Ethiopia’s history of fiercely guarded independence means while you might struggle to find a recognisable gin and tonic at the day’s close, you should have less difficulty savouring a decent ouzo, a legacy of the influx of Greek traders in the early 20th century).

But that malleability has already led to some concerns being voiced about the nature of foreign business expansion in an immature market like Ethiopia’s.

A 2013 report by ActionAid, an international non-governmental organisation tackling poverty and injustice worldwide, noted a darker side to foreign direct investment due to companies operating with the help of subsidiary companies working in tax havens. The result, the report argued, is that countries like Ethiopia are not deriving as much benefit as they should.

Beverage companies are quick to point out jobs created and the high number of indirect jobs supported. Those at Meta Abo Brewery say it sources its barley from 6,000 local farmers. Heineken claims that through its Ethiopian operations it indirectly supports 41,300 jobs, which will increase to more than 74,000 as a result of planned growth.

In the region of Harar, where it bottles the beverage of the same name, it is involved in Sustainable Water Sources Harar, a project that aims to provide water access for 50,000 people.

“We want to operate in a way that improves the quality of life for local individuals and communities, helps the environment and ensures a consistent supply of our raw materials,” Heineken says.

Despite such claims, concerns remain, especially about unavoidable health consequences of increasing alcohol consumption.

“[The] lower the economic development of a country or region, the higher the alcohol-attributable mortality and burden of disease and injury per litre of pure alcohol consumed,” according to the World Health Organisation.

A recent report in the British Medical Journal noted how the UK government has enthusiastically backed beverage companies and facilitated entry, expansion and investment in developing country markets.

The report finishes by noting that while health goals can’t be expected to automatically trump other important foreign and economic objectives, the UK government needs to recognise and address tensions between economic interests and global health objectives.

Those at Diageo point out they were the first to introduce responsible drinking and ‘don’t drink and drive’ campaigns to Ethiopia, with other beverage companies following their example.

“It’s not short term, it’s about sustainability – we care,” Agbonlahor says. “We want people to celebrate each day; if they drink too much they won’t be able to celebrate the next day.”

When it comes to discussion of alcohol-related health concerns, you won’t hear much from Ethiopian drinkers packed into clubs and bars along the streets of Addis Ababa, eagerly ordering another Meta Premier or St George or Bedele Special during a raucous Saturday night that merges into a bleary-eyed and perhaps somewhat painful Sunday morning hangover.

Whether similar headaches will afflict those trying to wrestle control of Ethiopia’s beverage market remains to be seen. For although international brands can bring expertise and specialist skills to Ethiopia, there are those in the international beverage industry who note the challenge of implementing strategy: wealth and resources can only go so far without the cooperation of local administrators and staff.

They also note how global beverage markets operate at high speeds and that Ethiopia will need to adjust accordingly to be a successful participant, and allow those investing in it to get their sought after gains.

The likes of Diageo aren’t leaving anything to chance. In the past year the company has introduced its Master Bar Academy (MBA) to Ethiopia. A bartending programme, MBA aims to develop stronger knowledge and bartending skills, such as making cocktails. To date the programme has trained over 14,000 bartenders across 30 cities and 14 African countries.

I can appreciate the rationale behind the strategy. There aren’t many bars in Addis yet where I would feel confident of getting a decent Margarita; I wouldn’t dare try ordering a Long Island Iced Tea. But that’s likely to change soon.

In the meantime, when it comes to beer, you are on much safer ground – I have always enjoyed and will continue to readily imbibe any of the local brands on offer. For when it comes to taste and price for the consumer, the competition only seems to be improving an already tasty and satisfying Ethiopian beverage tradition.

“The beauty of competition is it is great for everyone: the consumer, the country, socio-economic development,” Agbonlahor says. “Sure, it’s going to be tough for us, but we’re not new to this – we’ve competed in more than 180 countries before. Bring it on.”