Indonesia weighs complete alcohol ban

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by Arno Maierbrugger - Aug 16, 2016 2767

More than one year after Indonesia started partially banning the sale of alcoholic beverages in convenience stores and other small shops and kiosks, the government is considering to introduce a complete ban of production, distribution, sale and consumption of drinks containing more than one per cent alcohol throughout the country.

So far, in larger and licensed supermarkets and hypermarkets, alcoholic drinks remained available after last year’s regulation. However, the number of these larger supermarkets is limited, hence it became much more difficult to purchase alcoholic beverages or – if consumed in restaurants, hotels or cafes – it became much more expensive. At the same time, the new entrepreneurial businesses of home delivery services for booze, mostly through motorbike taxis ans smartphone apps, experienced a boom.

But now, with a complete prohibition – possibly including holiday destinations that are not even Muslim such as Bali – Indonesia’s economy could suffer a double blow: Firstly, tourism numbers would drop significantly, and secondly, the country’s large breweries such as Multi Bintang Indonesia, part of the Heineken Group, and Delta Djakarta, a subsidiary of San Miguel Corporation, would have to align their corporate strategies towards ultra-low alcohol or alcohol-free beer and soft drinks, which would likely dent their revenues significantly and not be in the interest of its foreign parent companies.

With regards to tourism, Indonesia receives about 11 million foreign visitors a year, of which four million are heading to Bali. Hariyadi Sukamdani, head of the Indonesian Hotel and Restaurant Association, told the Jakarta Post that “if the bill is passed, our business will be done. No matter how beautiful the country is, if tourists can’t find alcohol, they won’t want to come here.”

Another unwanted result of alcohol prohibition is of course the creation of a black market for booze and a rise in sales in bootlegged booze that can have potentially harmful health consequences. Due in part to the increasing cost of importing liquor, Bali has already seen a rise in the sale of home-brewed drinks laced with methanol, which have been linked to deaths and serious illness of tourists on the party island.

In predominantly Muslim Indonesia, consumption of alcohol is generally regarded a negative matter as it is forbidden (haram) as per Islamic doctrine. However, consumption of beer had actually risen in the years prior to the ban, particularly in urban areas where people have higher spending power and increasingly adopt a modern urban lifestyle. This is also possible because there are millions of nominal Muslims in Indonesia who do not strictly follow Islamic principles.

The anti-alcohol bill was introduced by two Islamist parties, the United Development Party and the Prosperous Justice Party, and is now being reviewed by Indonesia’s House of Representatives. If passed, the law would be the first of its kind in Muslim-majority Indonesia.

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More than one year after Indonesia started partially banning the sale of alcoholic beverages in convenience stores and other small shops and kiosks, the government is considering to introduce a complete ban of production, distribution, sale and consumption of drinks containing more than one per cent alcohol throughout the country. So far, in larger and licensed supermarkets and hypermarkets, alcoholic drinks remained available after last year's regulation. However, the number of these larger supermarkets is limited, hence it became much more difficult to purchase alcoholic beverages or - if consumed in restaurants, hotels or cafes - it became much more...

More than one year after Indonesia started partially banning the sale of alcoholic beverages in convenience stores and other small shops and kiosks, the government is considering to introduce a complete ban of production, distribution, sale and consumption of drinks containing more than one per cent alcohol throughout the country.

So far, in larger and licensed supermarkets and hypermarkets, alcoholic drinks remained available after last year’s regulation. However, the number of these larger supermarkets is limited, hence it became much more difficult to purchase alcoholic beverages or – if consumed in restaurants, hotels or cafes – it became much more expensive. At the same time, the new entrepreneurial businesses of home delivery services for booze, mostly through motorbike taxis ans smartphone apps, experienced a boom.

But now, with a complete prohibition – possibly including holiday destinations that are not even Muslim such as Bali – Indonesia’s economy could suffer a double blow: Firstly, tourism numbers would drop significantly, and secondly, the country’s large breweries such as Multi Bintang Indonesia, part of the Heineken Group, and Delta Djakarta, a subsidiary of San Miguel Corporation, would have to align their corporate strategies towards ultra-low alcohol or alcohol-free beer and soft drinks, which would likely dent their revenues significantly and not be in the interest of its foreign parent companies.

With regards to tourism, Indonesia receives about 11 million foreign visitors a year, of which four million are heading to Bali. Hariyadi Sukamdani, head of the Indonesian Hotel and Restaurant Association, told the Jakarta Post that “if the bill is passed, our business will be done. No matter how beautiful the country is, if tourists can’t find alcohol, they won’t want to come here.”

Another unwanted result of alcohol prohibition is of course the creation of a black market for booze and a rise in sales in bootlegged booze that can have potentially harmful health consequences. Due in part to the increasing cost of importing liquor, Bali has already seen a rise in the sale of home-brewed drinks laced with methanol, which have been linked to deaths and serious illness of tourists on the party island.

In predominantly Muslim Indonesia, consumption of alcohol is generally regarded a negative matter as it is forbidden (haram) as per Islamic doctrine. However, consumption of beer had actually risen in the years prior to the ban, particularly in urban areas where people have higher spending power and increasingly adopt a modern urban lifestyle. This is also possible because there are millions of nominal Muslims in Indonesia who do not strictly follow Islamic principles.

The anti-alcohol bill was introduced by two Islamist parties, the United Development Party and the Prosperous Justice Party, and is now being reviewed by Indonesia’s House of Representatives. If passed, the law would be the first of its kind in Muslim-majority Indonesia.

Support ASEAN news

Investvine has been a consistent voice in ASEAN news for more than a decade. From breaking news to exclusive interviews with key ASEAN leaders, we have brought you factual and engaging reports – the stories that matter, free of charge.

Like many news organisations, we are striving to survive in an age of reduced advertising and biased journalism. Our mission is to rise above today’s challenges and chart tomorrow’s world with clear, dependable reporting.

Support us now with a donation of your choosing. Your contribution will help us shine a light on important ASEAN stories, reach more people and lift the manifold voices of this dynamic, influential region.

 

 

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• TAGS
• Alcohol ban
• Bali
• Beer sales
• Bintang
• Heineken
• Indonesia
• Prohibition
• San Miguel

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