Myanmar has an import ban of beer, but the market research firm said that up to 30 percent of all beer sold is illegal, a size of nearly 1 million hectoliters in 2016. Of this, 96pc is beer that is smuggled across borders by land or boat. Based on the research which included store checks across four cities, 95pc of illicit beer is well-known, mainstream Thai brands.

The research firm estimates the loss of tax revenue for the government caused by the illicit trade of beer as $48-52 million in 2016. This is the amount which could be earned by the government if legitimate beer producers in Myanmar could instead make up the volume.

Specifically, research findings in this country suggest that affordability is the key driver for consumption of smuggled beer, which is on average about 35pc cheaper than locally produced beer for a 330ml can, based on store check findings.

The research was conducted between August and November 2017. It included desk research, store audits in Mawlamyine, Myawaddy, Tachileik, and Taunggyi, and interviews with retailers, distributors and officials.

BAM response

A spokesperson from the Brewers Association of Myanmar (BAM) said in response to the report that the illicit trade presents a concern for consumers, the government and the private sector alike.

“The high prevalence of illicit beer as highlighted in the Euromonitor report is a concern not only for local beer producers but also for consumer safety, government revenues, and the economic development of Myanmar. Smuggled beer is a third cheaper than locally produced beer because it pays no tax.

“On the contrary, the local beer industry paid K150 billion in Special Goods Tax last year and is proud to invest and provide jobs in Myanmar,” the spokesperson said, adding that the BAM is willing to work with stakeholders to raise awareness and support authorities in law enforcement efforts.

The high prevalence of illicit beer … is a concern not only for local beer producers but also for consumer safety, government revenues, and the economic development of Myanmar.

– Spokesperson, Brewers Association of Myanmar 

The report cites that 75pc of smuggled beer is packed in can, due to its ease of transportation. It is estimated that 80pc of smuggled beer is passing through the Thai border, with 20pc through the Chinese border. The proportion of illicit beer sold in retail is highest in areas near the borders.

“Compared to other countries where counterfeit beer, home-brewing or parallel trade is high, identifying illicit beer in Myanmar is relatively easy – it is all brands not produced in Myanmar. Beer producers in Myanmar offer a range of local and international brands, and consumers can check the labels on their beer to confirm it says ‘Made in Myanmar’,” the BAM spokesperson continued.

Source: https://www.mmtimes.com/news/government-loses-52m-2016-due-illicit-trade-beers.html