ZAMBIA – Government says the investment of K20 million (about US$ 2 million) to re-commission local production of Castle Lite lager will play a critical role in complementing Government efforts in creating wealth and jobs.

Officiating at the commissioning the plant, Minister of Commerce, Trade and Industry Margaret Mwanakatwe said the investment is a direct response to its reduction of excise duty on clear beer from 60 percent to 40 percent.

In 2015, excise duty on clear beer production was increased to 60 percent, forcing Zambian Breweries to suspend local production of Castle Lite lager that resulted in increased smuggling activities.

Nevertheless, Government rescinded its decision and reduced the excise duty to 40 percent in the 2016 budget, a move that influenced the brewery company to invest K20 million (US$2 million) in the plant that has a production capacity of 27,000 bottles per hour.

“Economic development is a collective effort that should not be left to Government alone, but should involve all stakeholders including the private sector and civil society.

“We are happy that policies are working to result in this development,” she said.

In an interview shortly after commissioning of the Castle Lite production and packaging plant last Friday, Zambian Breweries Plc managing director Annabelle Degroot said the resumption of local production of Castle will help stabilise shortages and result in reasonable prices of the demand being driven beer.

Ms Degroot said 70 percent of the beer was being smuggled after excise duty was increased.

“But now things are looking positive and we have decided to re-open this production line that has resulted in job creation and increased revenue to Government.

“We didn’t anticipate high demand, hence some shortages but local production will help stabilise the situation and prices will be reasonable,” she said.

Earlier, the brewery’s operations director Franz Schepping said exporting of jobs to South Africa has come to an end.

“The company has confidence in the Zambian economy and will continue making such investments. Local production of Castle Lite means job creation and supporting value chains in the agriculture sector since barley is being bought locally.

“This development will also reduce smuggling, and we will try to avoid stock-outs like we experienced last December when demand was too high,” he said.

February 8, 2017;