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Tobacco thumps Gov in court, alcohol fights to prevent regulations, plus Xolani Dube gives his forecast

"President Cyril Ramaphosa is expected to address the nation this evening, 14 December 2020, on developments concerning the country's response and behaviour encompassing the pandemic, and the steps forward."

President Cyril Ramaphosa is expected to address the nation this evening, 14 December 2020, on developments concerning the country’s response and behaviour encompassing the pandemic, and the steps forward. His address follows meetings with the National Coronavirus Command Council (NCCC), the President’s Coordinating Council (PCC), and a special sitting of Cabinet on Sunday, 13 December 2020. During his address, the President is expected to discuss a wide range of new restrictions in light of the country not adhering to regulations, thereby inducing the second wave of COVID-19.

For the most part, people want to know what the restrictions are and more so, which industries (e.g. tobacco and alcohol) will be affected if a lockdown is reinstated. 

In lieu of this, the South Africa Tobacco Transformation Alliance (SATTA) weighed in on recent events in the industry, to offer South Africans some peace of mind and insight. Firstly, the tobacco industry was defended by the Western Cape High Court Ruling—which ruled that Regulation 45 – promulgated as part of the country’s COVID-19 lockdown regulations, was inconsistent with the Constitution, and therefore unlawful.

With the ban on the sale of tobacco sales during the hard lockdown now deemed as unconstitutional, Zachariah Motsumi, spokesperson for the South Africa Tobacco Transformation Alliance (SATTA), states, “The ruling does not undo the almost-calamitous damage that has been caused to the tobacco industry value chain, nor does it provide much comfort to the millions of cigarette smokers who were inconvenienced or grossly over-charged by illegal cigarette dealers during the lockdown.”

Motsumi further points out the ruling assists in preventing the Government from trying to enforce a similar lockdown should the spread of the COVID-19 virus continue to develop—and ultimately reinforces the importance of closing the space for illicit tobacco sales. “There can be no doubt that the five-month ban on the sale of tobacco products was not only unlawful but also opened up an already-large gap in the market for illicit traders.”

While the tobacco industry is confident another ban on the sale of tobacco products will not be implemented—South Africa’s alcoholic producers and distributors are continuing their journey in convincing the Government to not impose yet another ban on the sale of alcoholic beverages.

Playing the passive card for the obvious reasons, thereby showing its willingness to work alongside the Government—the alcohol industry has stated it has made a pre-emptive move to withdraw support from major entertainment events during the Festive Season. This is to discourage large gatherings and to minimise an influx of patients admitted to hospitals due to accidents.

Furthermore, Richard Rushton, Chief Executive Officer of Distell Group Holdings, has confirmed, an outright ban on alcohol will have a catastrophic impact on the economy, especially as the necessary taxes will not be able to be collected by Gov. 

According to the National Treasury data, the ban on alcohol sales put investment projects worth at least R12.8 billion on hold.

In support of this, South African Breweries states the estimated Excise Tax, which the Government wrote off just from the alcohol industry, due to the illicit trade during the last ban was R3.4 billion. 

When looking at the impact, the ban on alcohol sales does not only influence retailers but, like the tobacco industry, also affects people across the entire value chain. This includes the glass industry which relies heavily on alcohol production due to bottling, as well as farmers who will not be able to utilise the barley they have planted.

With a great deal of uncertainty, surrounding the President’s address, it seems Newcastillians can expect the following topics to be discussed:

  • Stricter curfew times.
  • Restaurants to have earlier closing times.
  • Further restrictions on gatherings such as funerals.
  • New rules around beaches, especially with the holiday season upon us.

Gaining credible knowledge, the Newcastillian – Online News discussed the pending President’s address with political analyst, Xolani Dube.

The upcoming address, which Ramaphosa lovingly classifies as a family meeting, Dube stresses is challenging to predict what outcome South Africans can expect. However, “Our economy is not doing well, despite the propaganda that states the GDP has picked up. Also, there is the contradiction whereby the Department of Tourism is doing promotions, and the Health Minister is saying that we are in the midst of a second wave.”

With this in mind, Dube says he doubts the President will find the middle ground, but will instead end up promoting himself. Even then, when putting himself in the public spotlight, he emphasises Ramaphosa does not provide anything tangible, nor concrete, he merely places himself in everyone’s face by appearing on television.

The financial stresses generated by political irrationality is a weight the people of South Africa cannot further endure, such as another hard lockdown. “People have lost a lot while being under house arrest, and our economy won’t allow us to do it again. People have also seen that the Government never saved us.” Dube affirms.

According to the political analyst, South Africans continue to lose vast sums of respect for both the President and the ruling party as a result of their constant inability to manage the country. “This is proof that they are unable to govern the country and the inhumanness of the organisation of the ANC,” Dube concludes.

As we now await insight from President Cyril Ramaphosa on the way forward this holiday season, what are your thoughts on the situation? 

Share your opinions and views with us in the comment section below

Authors: Quinton Boucher and Calvin Swemmer

Edited: Calvin Swemmer

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