Vietnam: Strict drunk-driving laws push beer sales severely down

After Vietnam introduced harsh penalties for drunk-driving with effect January 1, beer sales in the Southeast Asian country have plummet by at least 25%, Bloomberg reported. The law, which was introduced to fight tragic accidents which often shook the nation last year, came into effect just days before the Lunar New Year, which is usually a busy time for restaurants, bars, and beer halls.

The new law stipulates that drivers must be “completely sober while operating vehicles”. Drivers violating the law run the risk of having their driving licenses revoked for up to two years. Cars and truck driver will face in addition a penalty of as much as VND 40 million (USD 1,739) while motorbike drivers will “only” pay fines up to VND 8 million (USD 345).

Authorities appear to be taking implementation seriously. In the first half of January, the Ministry of Public Security’s traffic department issued fines totaling VND 21 billion (USD 900,000) in 6,279 cases, according to information provided by the Vietnam News Agency.

The new law also bans advertising alcoholic beverages on television and other media platforms between 6:00 pm and 9:00 pm and requires stores to post signs announcing the ban on alcohol sales to those younger than 18.

 “Falling beer sales are a reality. We haven’t got an exact number of the decline in alcohol sales yet, but they have definitely dropped a lot,” said Luong Xuan Dung, general secretary of The Vietnam Beer Alcohol Beverage Association.

Stocks of international brewing companies that invested heavily in the Vietnamese beer market in recent years have been severely hit by the new law. Heineken’s share price fell as much as 5 per cent in Amsterdam, when first news on weak sales figures became public. Vietnam generates roughly 12 per cent of Heineken’s earnings before interest and taxes and about 5 per cent of its group sales. The Dutch brewer has been operating in Vietnam since 1991 and operates today six breweries and nine sales offices.

Share this article: