“Exporting jobs’ via fizzy drink cans

In the past few months, from around August or September 2014 to be precise, there has been a craze about fizzy drinks in cans.

Previously sold in upmarket shops and seen as a product for the elite, at least in Malawi, the canned fizzy drinks suddenly flooded the market. They come in all flavours. From the traditional Fanta (orange and grape flavours), Coca-Cola and Sprite to Twist, there is no doubt Malawians have fallen in love with the drinks.

The canned fizzy drinks are being brought in courtesy of Carlsberg Malawi Limited through its Coca-Cola Company franchise managed by Southern Bottlers (Sobo).

On a positive note, the canned fizzy drinks eased the shortage of soft drinks or minerals on the Malawi market, especially during the summer months.

My major concern about the canned fizzy drinks has been their non-biodegradable nature which, I must say, is an environmental disaster in the making. Surely, something needs to be done by authorities who banned thin plastic bags over similar environmental concerns.

This week, some distributors of the canned fizzy drinks raised the prices citing increased production costs for the products.

Increased production costs? This did not add up to me as, for all I know, the last time I checked, the exchange rate was stable (in fact appreciating), inflation was on the downward spiral and fuel prices were constant.

That was when I recalled that the canned fizzy drinks are imported from South Africa!

Looked from a different perspective, every time we consume fizzy drinks in cans, imported from South Africa, bear in mind that we are exporting jobs! How? If Carlsberg Malawi Limited had increased local production capacity, more jobs would have been created and more taxes would be paid to develop Malawi. However, by choosing to import, regardless of whether it is from its sister unit, the company is also paying for the water used in the production line in South Africa, cutting on its consumption of local water boards’ supply thereby enriching the South African water supplier at the expense of the Malawi industry.

Somehow, the whole transaction sounds like dumping to me.

I do not understand the logic behind importing ‘water’ in form of canned drinks all the way from South Africa when locally we are able to produce the same product and package it in glass bottles.

If returnable glass bottles are expensive, why not use polyethylene terephthalate (PET) bottles whose manufacturing plant the company has in Blantyre?

The advantage with PET bottles is that they can be “recycled” for use.

These so-called “sister unit-relationships” appear so rosy on the surface, but have ended up hurting our economy. Examples include Unilever South East Africa and British American Tobacco (BAT) which started by substituting local production with imports from “sister” production units in Zimbabwe. Today, their “factories” are as quiet as a graveyard.

My position is that for every import we make, multinationals such as the Coca-Cola Company should find a way of investing, in the medium to long term, in production line for the same locally. In the case of cans, if they can be produced elsewhere within the Southern African Development Community (Sadc) region, why can they not be Made in Malawi?