Companies that belong to the Beverage Association of South Africa make and sell some of the world’s most popular and trusted non-alcoholic beverages. Some of these organizations have indirectly been part of many occasions South Africans have enjoyed.
The South African beverage industry is an important part of the nation’s economy. The industry supports its local communities through jobs, tax revenue and civic contributions. According to American Economics Group, Inc., the beverage industry is responsible for creating 3.02 million jobs that generate $278 billion in economic activity. Direct compensation to 211,000 beverage industry workers tops $9 billion. At the state and federal level, soft drink industry firms pay more than $30 billion of business income taxes, personal income taxes and other taxes with over $14 billion in taxes paid to state governments alone. In 2003, beverage companies donated roughly $326 million to charities.
In 2007, Americans spent roughly $105 billion on refreshment beverages. According to Beverage Digest, in that same year, the U.S. non-alcoholic refreshment market totalled almost 15.6 billion cases (192-oz). Carbonated soft drinks made up 63.7 percent of the total with non-carbonated products comprising 17.0 percent and single-serve bottled water accounting for 19.3 percent.
In the ten months since the Health Promotions Levy (HPL) was introduced, it has put pressure on the local non-alcoholic industry in already difficult operating conditions, as well as raising prices for hard-pressed consumers. The net impact of the levy has been compounded by subdued economic growth in the country and higher input costs of raw materials and ingredients, in particular, sugar. Consequently, this is limited the opportunity for growth and job creation in the sector and has resulted in downward pressure on the full value chain.