Counterfeit alcohol is a significant problem in Africa, with a high prevalence in many countries
A quarter of all alcohol consumed globally is unrecorded
The problem of counterfeit alcohol and illicit consumption is a growing concern for stakeholders in the alcohol industry as well as governments worldwide. A report by the World Health Organization (WHO) in 2018 suggested that 25% of all alcohol consumed globally is unrecorded. Since 2018, the COVID-19 lockdowns/restrictions increased alcohol sales, especially through online marketplaces which were targets for counterfeiters. Many counterfeiters were able to sell their products through online marketplaces, hence it could be deduced that the percentage of illicit/counterfeit alcohol consumption increased. The negative consequences of counterfeit alcohol sales can be felt at every level; for brand owners, sales are lost and brand equity is eroded, while governments lose tax revenues and countries become less attractive to legitimate traders and investors.
There are concerningly high shares of illicit/informal alcohol markets in Africa
Counterfeit alcohol is a significant problem in Africa, with a high prevalence in many countries. The countries most affected by counterfeit alcohol can vary over time, depending on various factors, such as government policies, law enforcement, and economic conditions (UNODC). Some countries that have experienced problems with counterfeit alcohol in the past and present include (but are not limited to): Uganda which had the largest share of its alcohol market derived from illicit sales among African countries in 2018, Nigeria, Kenya, South Africa, Tanzania and Uganda. According to a report by Statista, the share of illicit/informal alcohol market in selected African countries in 2018 was around 40%, and again, this percentage was likely higher today compared to pre COVID-19.
Quick profit, low cost alcohol production leads to counterfeit sales
Counterfeit alcohol is typically produced and sold by criminal gangs or individuals looking to make a quick profit, and often made using substandard or harmful ingredients. The production process for counterfeit alcohol varies, but it often involves using low-quality ingredients such as methanol or other toxic chemicals, which can lead to serious health problems or even death for those who consume it. Counterfeit alcohol is commonly sold in unlicensed outlets such as roadside stalls (kiosks), small shops and street markets.
Demand of brands and categories dictates the counterfeit production
The impact of counterfeit alcohol is felt most heavily by low-income individuals who are more likely to purchase cheaper, illicit products. In terms of the specific brand or categories impacted, it is difficult to generalize as counterfeits will often mimic popular brands in order to deceive consumers. However, spirits such as vodka and whiskey are commonly counterfeited due to their popularity and higher profit margins.
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