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Today's Headlines Alcohol
After the deal between Modern Internasional and Charoen Pokphand Indonesia to acquire convenience store 7-Eleven from Modern Putra Indonesia, a subsidiary of Modern Internasional, was scrapped earlier this month, Modern Internasional has now announced it will terminate all operations of the existing 120 7-Eleven stores per June 30, 2017.
On 29 May 2016, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website over the last seven days. Most of the topics involve economic matters such as an update on the Indonesian economy, inflation, credit ratings, business sectors that have been opened up to foreign investment, IPOs, the palm oil industry, and more.
Good news for those who love beer and live in Jakarta. About one year after Indonesia announced it had banned sales of alcoholic beverages in minimarkets and kiosks - a move conducted to "protect the morals and culture of Indonesian society" - Jakarta Governor Basuki Purnama Tjahja (Ahok) said alcoholic beverages with alcohol content up to five percent (which includes beer) will again be available in the capital city's minimarkets, the small retailers that have mushroomed across the city streets.
Since April 2015 sales of alcoholic beverages in kiosks or minimarkets in Indonesia are forbidden. Previously, light alcoholic beverages, such as beer or breezers, could be bought in these shops that have mushroomed in Indonesian cities. This was bad news for producers of light alcoholic beverages because it was made less easy to buy an alcoholic beverage. For such a drink you now have to go to the (licensed) supermarkets and hypermarkets or visit a cafe or restaurant. This increases the distance you need to travel for a drink or - when drinking in a cafe or restaurant - it becomes much more expensive.
When the government of Indonesia banned the sale of alcoholic beverages in minimarkets and kiosks in early 2015 in an effort to “protect the morals and culture of Indonesian society”, it came as a shock to alcoholic beverage producers. Although alcoholic drinks are still allowed to be sold in the larger supermarkets, restaurants, cafes and hotels, sales of beer plunged as the beverage was banned in the (estimated) 70,000 minimarkets that have become a very popular shopping place in the urban areas of Indonesia.
On 19 April 2015, Indonesia Investments released the latest edition of its newsletter. This free newsletter, which is sent to our subscribers once per week, contains the most important news stories from Indonesia that have been reported on our website in the last seven days. Most of the topics involve economic matters such as an update on Bank Indonesia’s interest rate policy, the performance of the rupiah, the March trade balance, updates on coal, palm oil, cement and car sales, GDP growth forecast, alcohol in Indonesia, and more.
After having banned the sale of alcoholic drinks in minimarkets, Indonesia may see the birth of another law concerning alcohol. Several secular and Islamic political parties seem to back a bill prohibiting the sale, production, distribution and consumption of drinks that contain over 1 percent alcohol. This bill is among the 37 so-called priority bills expected to be passed this year. Although the new bill had been first proposed in 2012 by two Islamic parties - National Development Party (PPP) and Prosperous Justice Party (PKS) - it had laid on the shelf.
Indonesian Trade Minister Rachmat Gobel confirmed that the ban on sales of alcohol in minimarkets and kiosks will continue after 16 April 2015. This ban, stipulated by Minister of Trade Regulation No. 06/M-DAG/PER/1/2015 on the Control and Supervision of Procurement, Distribution, and Sale of Alcoholic Beverages (which was signed by the minister on 16 January 2015), prohibits the sale of beverages with an alcohol content ranging between 1 to 5 percent (referred to as type A alcoholic drinks) in minimarkets and kiosks.
Latest Columns Alcohol
Those companies that make money through sales of alcoholic beverages in Indonesia have been experiencing challenging times in recent years. It is a fact that Indonesian society has become more conservative over the years (this is actually a process that has been ongoing for centuries), and Indonesia’s 2019 presidential and legislative elections showed how the political influence of conservative Muslim clerics has grown.
Delta Djakarta, a beverage manufacturer that is particularly known for producing beer, is eager to focus on export markets as growth of domestic sales is limited in the world's biggest Muslim-majority nation. In Islam, consumption of any intoxicants, including alcoholic beverages, is generally forbidden and therefore demand for alcoholic beverages is limited at home. That is also why the local Jakarta government is set to sell its stake in the company.
