Tell us about Pernod Ricard's journey in Africa?
It started in 1994, when our first affiliate in South Africa opened. In 2011, we identified Sub-Saharan African countries as broad markets with high potential, and since then have consistently invested every year on the continent. Today, in addition to our historic affiliate in South Africa, Pernod Ricard has affiliates in eight other countries, including in Kenya, Ghana, and Nigeria as well as representatives in few others, including Ethiopia and Cameroon. Our business focus has been evolving over time. Originally, we were concentrating almost exclusively on importing our international brands, such as cognac Martell and Irish whiskey Jameson. However, the EU Economic Partnership Agreements (EPAs) did not provide sufficient opportunities to substantially improve the import conditions for our European products to the continent. This is one of the reasons why we have started increasing our investments in the region, with the opening of local production in Nigeria and Cameroon. Over the years, our whiskies produced in Africa have been growing exponentially. Therefore, we support the faster implementation of the African Continental Free Trade Area, (AfCFTA), as it would give us tangible opportunities to increase intraAfrican trade and creating conditions for investment in more supply chains and jobs.
I would like to see more daring and creativity from the EU when it comes to building partnerships with African countries
You joined Pernod Ricard in Africa in 2012, what opportunities and challenges can you indentify for doing business in Africa?
There is clearly an increasing demand for European premium food and drinks products, including spirits across Africa. In Sub-Saharan Africa, our sales have grown by 152% over the past 10 years. However, the obstacles to sustainable growth and the creation of jobs are complex and are increased by COVID-19. The scale of the informal market coupled with problems in doing business and good governance, is a major business challenge for legitimate business across many sectors. Many African countries are still relying heavily on high import tariffs on a few high value import products. Giving illicit traders incentives to continue their activities, hindering competition and the possibilities for legitimate traders to grow. Lack of currency reserves is another concrete and systemic challenge for foreign companies of all sectors, that impedes expansion.
What could the EU do to support European Business in Africa?
I would like to see more daring and creativity from the EU when it comes to building partnerships with African countries. Strict enforcement and further upgrading of the Economic Partnership Agreements (EPAs) is an important area that could bring improvements. Modernising EPAs should a include tariff liberalisation for EU products that were previously excluded. The EU can also lead on creating regular private-public platforms for European business to discuss with individual African governments policy matters and joint initiatives. This would make sense from a government, private sector, and society perspective. I previously mentioned our illicit trade concerns, which could be one area to look at. This would be in the mutual interest for both the EU and African countries to attract more investment.
Our Sustainability and Responsibility roadmap, is based on four key pillars supporting the United Nations Sustainable Development Goals
Despite business challenges, you are still very active on sustainabililty and responsibility. What are your key initiatives?
Since it was founded in 1975, Pernod Ricard has stood for universal values of responsibility, transparency, and respect for all people and cultures. Our Sustainability and Responsibility roadmap, is based on four key pillars supporting the United Nations Sustainable Development Goals (SDGs); Valuing People (SDG 8 and 5), Responsible Hosting (SDG 3 and 17), Circular Making (SDG 12 and 14) and Nurturing Terroir (land) (SDG 13 and 15). The unprecedented worldwide pandemic since 2020 reaffirms the strength of this strategy, and the necessity to accelerate transition. Pernod Ricard SSA proudly employs more than 600 people across the region and is the first and only beverage company to be certified as a Top Employer in Sub-Saharan Africa since 2016. This is in recognition of outstanding human resource practices, and for providing a supportive work environment where employees can develop both professionally and personally. The company is fully committed to fighting against alcohol misuse and to protect consumers. We work hand in hand with trade associations, national authorities, and partner organisations to deliver strong prevention programmes. In South Africa the new Drink More Water campaign signed by Pernod Ricard under the umbrella of its historical initiative Responsible Party, is a perfect example of our engagement to tackle binge drinking among an exposed population – young adults. In less than 6 months, the initiative has reached 12 million young adults in South Africa, and 21 million across Africa, powered by a very strong campaign on social media. This campaign will also be activated offline in the real world going forward. This is one of several initiatives Pernod Ricard is bringing to the region, as we intend to bring good times from a good place, to create a more convivial world, but one without excess.
This content was commissioned by Pernod Ricard and produced by Dods