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Dry December with empty wallets

27 Dec 2020

Alcohol sales plummet without tourists and low incomes

  Amidst the absence of tourism in the country and decreased levels of purchasing by local consumers, alcohol sales during the festive season have dropped considerably, as confirmed by several leading industry players. Industry players, on the condition of anonymity, told The Sunday Morning Business that compared to the same month in the previous year, the volume of sales witnessed a significant drop during the otherwise soaring festive season. The drop was firstly attributed to the absence of tourism due to the closure of the Bandaranaike International Airport (BIA) until yesterday (26). According to the industry, the period from October to February annually witnesses a higher number of tourists coming into Sri Lanka than during the rest of the months. This period covers Christmas and New Year, and tourists travel to Sri Lanka to celebrate them and consume a considerable amount of alcohol.   The second reason the industry noted was the lack of purchasing by local consumers. “Due to the pandemic and subsequent job cuts, salary cuts, and cancellation of year-end bonuses, people have no money to splurge on liquor this year,” an alcohol manufacturer stated. Sri Lanka’s liquor industry is one of the top contributors to the country’s tax revenue. It lost its annual Sinhala and Tamil New Year and Easter sales this year, owing to the ongoing curfew imposed to mitigate the spread of Covid-19 within the country.   As noted by industry players, the losses are in billions of rupees, as Easter and New Year sales collectively bring in significant revenue, similar to that of Christmas any given year. Accordingly, sales are usually at 150% during this festive season compared to other months. According to a study done by LOLC Securities, Sri Lanka has recorded high per capita alcohol consumption when compared to the South Asian region. The significant loss in seasonal liquor sales is expected to reduce the Government’s revenue considerably. (MT)


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