This week (August 23-26), the Western Cape High Court will hear wine industry body, Vinpro’s, case to fully reopen and rebuild the industry, which includes the wine tourism sector.
“Despite all of the setbacks the South African wine industry has had to endure over the past 17 months, Vinpro has not backed down from the fight to fully reopen and rebuild the industry,” said Vinpro md, Rico Basson.
Vinpro is contesting the approach followed by government to liquor restrictions within the Disaster Management Act.
“Since the start of this pandemic we have argued that the provinces, not National Government, should decide whether or not to impose liquor restrictions and should do so with reference to provincial circumstances, including the need to preserve capacity in trauma units in hospitals in the province,” said Rico.
“We know provinces are affected differently by the pandemic, therefore we believe a differentiated approach in handling the crisis is needed to limit the economic impact of a lockdown.”
Vinpro launched its legal application during the second wave in January this year and has now also approached the court to include evidence for the way in which the blanket liquor ban missed its purpose during the third wave.
“While we have challenged Government’s decision by way of an urgent interdict application and hearing (on July 21) the matter was subsequently rendered academic because the ban was partially lifted four days later. In an interim application, we now ask that this evidence should also be taken into account.”
Rico pointed out that National Government’s respondents had vehemently opposed the application to introduce such further evidence. This opposition is mainly based on their argument that Vinpro’s application is moot, as the ban has been lifted.
“However, we have seen how Government has dealt with the previous liquor bans. A blanket ban is imposed repeatedly and, with a fourth wave likely to hit the country in December, this issue most certainly is not moot.
“Wine is part of agriculture, as is tourism. Our industry supports 80 183 people working at farm and cellar level and 188 913 people working further down the wine value chain. This industry has built a strong brand reputation as a unique asset for the country. The South African wine industry is more than a drink, it’s a livelihood. And it is our responsibility to make sure we save this industry for future generations,” Rico emphasised.
Sobering statistics
According to the Impact of Covid-19 on the Wine Value-Chain Survey that Vinpro conducted early in July – among wine grape producers, wineries and other wine-related businesses – 58% of the 549 respondents indicated that their businesses would have to make drastic changes over the next year to be able to overcome the current challenges related to COVID-19.
Nearly a quarter (22%) indicated that they would, in all probability not be able to survive at all. Even more alarming is the fact that 46% of black-owned brands and farms believe their businesses won’t be able to survive the next year.
Around two-thirds of all respondents’ revenue is generated from domestic wine sales, which reiterates the importance of domestic trade for the survival of the industry. The local market is of particular importance to smaller wineries and black-owned brands, which are heavily reliant on sales channels such as their tasting rooms, hospitality offering and e-commerce.
Furthermore, according to the Economic Value of Wine Tourism Study conducted by Vinpro in 2019, wine tourism represents 41% of these small businesses’ total turnover. “It is especially the small and micro enterprises that do not have sufficient bridging finance to sustain them through the current and continued restrictions,” said Rico.
