New Report Reveals The Extent and Impact of Illicit Alcohol
Feature 29 JUN 2018
Illicit alcohol is widespread in many countries, particularly in low- and lower middle-income countries, according to data compiled by Euromonitor for the International Alliance for Responsible Drinking (IARD).
The new report, ‘Alcohol in the Shadow Economy’, explores the cost to people, societies, and economies of this largescale and illegal activity and highlights the importance of creating partnerships between regulated producers, governments, and communities in tackling harmful drinking.
- Up to one in every two drinks is illicit in some parts of the world: much higher than previous global estimates
- The majority of alcohol drunk is illicit in five out of seven African countries covered
- Illicit alcohol is unregulated, untaxed, and potentially toxic
- Illicit alcohol represents a combined USD $1.8 billion fiscal loss across just 18 countries. The loss to Colombia alone in 2015 was USD $406million; in Mozambique, the loss in 2014 was USD $285 million
- Bringing unregulated alcohol production into the regulated sector and tackling illicit alcohol is essential in supporting the WHO’s whole-of-society response to the harmful use of alcohol
One of the examples for tackling illicit alcohol featured in the report is Diageo’s Senator Keg, an affordable and safe alternative brew that relies on low-cost ingredients sourced from local growers. The end result is a high-quality beer that is regulated, compliant with standards, yet competitively priced so that it is accessible to the poorest consumers who were previously at greatest risk from contaminated illegal alcohol. Senator Keg has been a globally acclaimed success and has supported growth and while serving an important public health goal for consumers and government.
"This important report shows that in many developing countries, much of the alcohol consumed is illicit. This is bad for health, bad for governments and bad for business. It is critical that governments create an environment where legal businesses can thrive and avoid punitive regulation that creates unintended consequences, including driving consumers to unregulated channels that endanger public health. IARD members, the leading beer, wine and spirits producers, are determined to play our part in cracking down on illegal alcohol production. But we will only win this fight in partnership with government, international bodies like the WHO and civil society organisations. Success will deliver a thriving legal market, creating economic and societal value and, critically, better health outcomes." Ivan Menezes, Chair of IARD’s CEO Group and Chief Executive of Diageo