i

Africa: The wine industry’s hotbed for future growth

Africa is a booming market for wines and spirits. In its search for new growth markets, the industry has for the past few years been casting an envious glance at the African continent, where the economy has become increasing stable. Spirits already have a firm footing there and have been paving the way for wine.

 

According to a report released at Vinexpo this year by The IWSR, wine consumption on the African continent is growing five times faster than the global average

 

One of the main drivers of growth is the emergence of a middle class due to a favourable economic context, with the economy growing at a rate of 5 to 6% annually over the past decade. Young people are drinking wine and view it as a premium product: “Drinking wine and spirits is in some ways akin to luxury”, explains Cameroonian importer, Félix Kamdem. Social media and the internet are also partly responsible for market progress.

 

African consumers are particularly fond of sparkling wines, sweet rosés and aromatic red and whites, such as Sauvignon blanc and Merlot. Concurrently with this, the spirits sector – spearheaded by whisky, brandy and Cognac – continues to show the most promise with a strong surge in demand: the rate of growth between 2010 and 2014 was 13% compared with 3% for wine, irrespective of style, and is expected to strengthen by 2018.

 

Despite this, high taxes and corruption are still major barriers to growth in this promising market, as is the route to market issue with financially sound distributors few and far between.

 

Statistics source: AFP