It is cheaper to drink wine in South Africa, and elsewhere in the world, but Kenya. Sector players have pegged this on the high taxation of wine imports into the country.
“The challenges that we face, not just in Kenya, but in Africa generally, are the high levels of import tax,” Greg Guy, the International Director of DGB, a South African premium wine and spirits producer and exporter, said. “You know, a bottle of wine here is costing you five or six times more than it would in South Africa.”
With a relatively high excise taxation, it is difficult for a consumer to have a glass of wine or a bottle of wine when compared to a beer or a local spirit; the cost differential is so high.
The tax implications have become a thorn for producers seeking customers. Further, high taxes have been associated with driving up smuggling.
“The higher the taxes get, the bigger the incentive to smuggle. And it’s not good for anybody. Wine can be more affordable if the tariff issues are fewer,” Mr. Guy said.
Wine is considered an aspirational drink from an economic and social standpoint. Most restaurants sell a glass of wine for Sh700 and upwards, depending on the establishment.
Retail wine prices in Kenya generally range from approximately Sh1,000 to well over Sh50,000 for a 750ml bottle, with most common varieties falling in the Sh1,500 to Sh4,000 range. Prices vary significantly based on factors like brand origin, vintage, special designations, and retailer.
Wine experts have said it costs a bit more because there is technical knowledge to it. This, however, highlights that it may not typically appeal to younger generations from the price point and the desire to get high from higher alcohol content at a more affordable rate.
Even so, notable shifts in wine consumption have taken shape in recent days, growing the sector in leaps and bounds in terms of the diversity of wines available for people, knowledge, and also how people enjoy them.
“So many Kenyans are very interested in wine. It’s not a luxury, but it’s sort of becoming a trend. At all social gatherings, wine is a must-have lately,” Meera Karia, the Director of Business Development at Viva Global Ltd, said.
Today, a lot of cafes or restaurants have a dedicated wine list; this, according to sommeliers, has a downside, as it can be intimidating given the extensive variety.
With many hotels and restaurants popping up in Kenya, wine is taking up good space and getting quite prominent in the food scene, as restaurants and hotels ask for wine brands that match their food, driving up sales.
Today, Kenyans are more accepting and discerning of wine varieties from the colours red, white, and rosé, to the grape varieties available from different countries, as well as the technical characteristics of wines, such as the acidity level, the sweetness level, and whether it is a medium body or a full body.
“Kenyan consumers enjoy the sweet wines, but a lot is changing in the wine scene. People love to see organic wines; they want to see less sugar,” Meera Karia said.
Wine enthusiasts, importers, and the wine community at large convened in Nairobi for the second Viva Wine Expo after a five-year hiatus. The event attracted a portfolio of over 20 wine brands for the exhibition of new wines from different regions, and also provided a platform to network with others in the community.
“Kenya has very knowledgeable, very educated people who want to learn and taste wine. Wine is a healthy, natural product,” Mr. Guy said, adding that it would appeal to Gen-Zs and Millennials who do not want to drink more.
The wine producer notes that younger generations in Kenya consume sweeter wine, but as they mature, they start drinking drier, and then more premium and more expensive wines.
The wine producer says that typically, older generations drink more wine. “If you look in Western economies, Gen Zs do not prefer wine. Millennials are drinking a lot of wine. The baby boomers are dying.”