Asia:  Vietnam’s Tough New Drunk-Driving Law Is Hurting Beer Sales

Mark Willingham Uncategorized

Asia:  Vietnam’s Tough New Drunk-Driving Law Is Hurting Beer Sales


By John Boudreau and Nguyen Dieu Tu Uyen

January 21, 2020

Vietnam’s new get-tough-on-drunk-driving law is reining in one of the world’s fastest-growing beer markets.

Beer sales in the country have dropped by at least 25% since strict penalties on inebriated drivers took effect on Jan. 1, and the police have issued more than 6,200 fines, according to local media. The Vietnam Beer Alcohol Beverage Association, which represents domestic and international brewers, says its members are complaining about a plunge in sales of the amber drink.

“Just look at any beer places and you will see how empty they are these days,” said Luong Xuan Dung, the group’s general secretary. “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.”

Heineken NV, a major foreign beer brand in Vietnam, fell as much as 4.6%, its biggest intraday drop since July 29.

Beer companies, which complain that the punishments are too harsh, have cut prices to shore up demand ahead of the boozy Tet Lunar New Year holiday.

Vietnam’s crackdown, a response to several high-profile accidents last year, has come as a surprise to many in the nation of hearty drinkers with a history of flouting alcohol restrictions (a law banning civil servants from drinking during work hours is widely ignored). The country’s beer consumption has nearly quadrupled since 2004, attracting global brewers from Heineken to Anheuser-Busch InBev looking for growth.

Under the new law, motorbike drivers can face fines as high as 8 million dong ($345), double the previous maximum, and a possible suspension of a driver’s license for two years, up from five months previously. Those driving automobiles or trucks under the influence may be hit with a penalty of as much as 40 million dong and a license suspension. The law also requires alcohol advertising to include health warnings and stores to post signs announcing the ban on alcohol sales to those younger than 18.

Authorities appear to be taking implementation seriously. In the first half of January, the Ministry of Public Security’s traffic department issued fines totaling 21 billion dong in 6,279 cases, Vietnam News reported.

A series of fatal accidents last year involving drunk drivers, including one in which a photo of boy weeping next to his dead mother’s body spread on social media, led to a protest in Hanoi against lenient alcohol laws. The outcry and lobbying by the Ministry of Health and female politicians such as Nguyen Thi Kim Ngan, the nation’s first National Assembly chairwoman, helped pass the law, said Vu Tu Thanh, senior Vietnam representative of the U.S.-Asean Business Council.

Health officials say Vietnam’s soaring alcohol consumption is causing public health problems. An estimated 79,000 deaths a year are tied to alcohol, according to the World Health Organization.

More than 80% of the nation’s drinkers are men and abuse of alcohol is leading to increasing societal harms, including vehicle accidents, domestic violence and social disorder, said Le Thi Thu, a program manager with the Hanoi-based HealthBridge Foundation of Canada. Negative effects of alcohol abuse are equal to 1.3% to 3.3% of the nation’s gross domestic product, according to the WHO.

Too Tough?

The Vietnam beer association says it supports tougher laws to encourage responsible drinking yet thinks the new fines are too steep, Dung said. Automobile drivers, for instance, could be hit with an 8 million dong penalty for having only a trace of alcohol, he said.

“We understand this regulation is necessary to make people more responsible when they drink,” Dung added. “But it is still very controversial.”

Vietnam’s growing middle class and youthful population helped drive a 284% surge in beer consumption between 2004 and 2018, according to Euromonitor International. That’s a reason behind Thai Beverage Pcl’s acquisition of a $4.8 billion stake in Saigon Beer Alcohol Beverage Corp. about two years ago. Vietnam, the third-biggest swiller of beer in Asia Pacific in total volume, saw per capita household consumption rise 30% between 2013 and 2018 to 43 liters (11.3 gallons), Euromonitor International said. The U.S., by contrast, had a 4% drop.

Downing large amounts of alcohol in Vietnam is intertwined with doing business, watching sports and celebrating holidays. “People are used to drinking all the time, wherever and whenever they want,” Thanh said.

Some have taken to social media to strategize on ways to get around the law. One man became an online sensation after a video was posted showing him locked in his car for hours and drinking water after being pulled over by police for suspicion of driving under the influence. He eventually was fined about 2 million dong for disobeying officers.

Beer restaurants are offering free or discounted motorbike or taxi rides home — or back to the office — to inebriated patrons. The sudden crackdown has led to purchases of “alcohol detox” pills online to avoid fines.

If the law is enforced, and police aren’t persuaded to look the other way, “it will improve Vietnam’s image, not only in the eyes of foreigners but in the eyes of its citizens,” Thanh said.

Nonetheless, the law is as harsh as a cold shower for some drinkers.

Nguyen Van Thi, a 60-year-old retired soldier, and a dozen of his friends sat at a long table filled with plates of pork rolled in banana leaves, fried fish and peanuts during a recent weekday lunch in Hanoi. Staff hauled cases of Tiger Beer and 3-liter chilled glass containers of bia hoi, or fresh beer, to tables of boisterous customers clinking mugs.

“I was a soldier. I always obey the rules,” Thi said. “But this law is so hard for me and my buddies.”