Uneasy Time for Alcoholic, Sugar-sweetened Beverage Manufacturers

Sustained campaigns by foreign and domestic organisations to limit consumers’ accessibility of alcoholic and sugar-sweetened beverages is creating uneasiness in the sub-sectoer of Nigerian manufacturing, writes Dike Onwuamaeze

This is an uneasy time for operators in the beverage sub-sector of the Nigerian manufacturing. The sub-sector is being assailed from two fronts. One the one hand is the recently released  World Health Organisation’s (WHO) “Global Report on the Use of Alcohol Taxes 2025” and the WHO’s “Global Report on the Use of Sugar-Sweetened Beverage (SSB) Taxes 2025.” Both reports made strong cases for higher taxations that would make the SSB and alcoholic beverages unaffordable.

According to the WHO, “Countries should improve tax design and increase taxes more systematically so that alcoholic beverage products become less affordable and as a consequence the burden of alcohol consumption and its related harms are effectively reduced.”

WHO also said, “Improving tax policy design and increasing taxes so that SSBs become less affordable should be pursued more systematically by countries in order to effectively reduce the intake of free sugars as part of improving population diets and preventing and controlling diet-related non-communicable diseases (NCDs), including obesity and dental caries.”

It claimed that empirical evidence indicated that as the prices of alcoholic beverages and SSBs increase and become less affordable, purchases and consumption of these products would decrease.

It argued that, “Alcohol and alcoholic beverages contain ethanol, which is a psychoactive and toxic substance with dependence-producing properties.

“The negative health impacts of alcohol consumption include those for maternal and child health, communicable diseases, NCD and mental health damage, injuries, and poisonings.

“The harmful use of alcohol1 results in the deaths of approximately 2.6 million people annually. It also damages the well-being and health of people around drinkers, and carries significant social and economic costs.”

On the other hand, the National Agency for Food and Drug Administration and Control’s (NAFDAC) enforcement of the ban on the production and sale of alcoholic beverages that is packaged in sachets, small plastic or glass bottles that are below 200 milliliters. The enforcement, which started in January 2026, is hinged on public health concerns.

According to the Director-General of NAFDAC, Professor Mojisola Christianah Adeyeye, the ban is meant to protect children, adolescents and young adults from the harmful use of alcohol.

Adeyeye said: “NAFDAC has resumed enforcement of the ban on the production and sale of alcoholic beverages packaged in sachets and small-volume PET or glass bottles below 200ml, in line with a resolution of the Senate of the Federal Republic of Nigeria and the Agency’s public health mandate.”

She argued that, “The widespread availability of high-alcohol-content beverages in sachets and small containers has made alcohol cheap, easily accessible and easily concealable, contributing to rising cases of underage drinking, addiction, domestic violence, road accidents, school dropouts and other social vices.”

“The current Senate resolution aligns with the spirit and letter of that agreement and with Nigeria’s commitment to the World Health Assembly Global Strategy to Reduce the Harmful Use of Alcohol,” she said.

Adeyeye stressed that, “This ban is not punitive; it is protective. It is aimed at safeguarding the health and future of our children and youth by not allowing alcohol in small pack sizes.

“The decision is rooted in scientific evidence and public health considerations. We cannot continue to sacrifice the well-being of Nigerians for economic gain. The health of a nation is its true wealth.”

However, it appeared that the NAFDAC is eager to swoop on the alcoholic beverage sector. Firstly, a Senate resolution is not a law that an agency under the executive arm of the government must comply with.

Secondly, it appeared that the NAFDAC is doing a forum shopping. According to the Manufacturers Association of Nigeria (MAN), NAFDAC’s implementation of the ban on the production and sale of alcoholic beverages packaged in sachets and small PET bottles is a flagrant disobedience of the directives from the Office of the Secretary to the Government of the Federation (OSGF) on the matter, as issued on December 15, 2025. It should be noted that the OSGF is the third highest executive office in Nigeria ranking only below the offices of the President and Vice President of the Federal Republic of Nigeria.

MAN added, “The recent action of NAFDAC is also in direct contradiction of the earlier resolution of the House of Representatives on the matter (vide NAS /10/HR/CT.33/77c of 14th March 2024); wherein the House of Representatives, after an all-inclusive consultation with stakeholders through a Public Hearing, restrained NAFDAC from taking the needless punitive action of banning the production of alcoholic beverages in sachets and PET bottles.

“Rather than abiding by the generally agreed resolution, NAFDAC bided its time and chose to rely on a resolution of the Senate that was devoid of the usual stakeholders’ engagement.

“We have since approached the Senate, and we trust that the distinguished members will reconsider after further consultations. This is particularly concerning as operators are now confused as to which directive to follow in the face of multiple directives.”

The manufacturers association emphasised that the advent of the sale of alcohol in sachets and PET bottles was not intended to have a negative impact on Nigerians.

“Rather, it was an innovation to serve the segment of the adult population with low budgets who desire the product and should have a right of choice.

“The ban would, therefore, deny them the opportunity to exercise that right. In addition, and on the positive side, availability in small portions could also discourage abuse associated with bigger portions,” MAN said.

“Equally important to note is that alcohol served in sachets by local producers is produced under hygienic conditions and certified by our regulatory agencies, which include NAFDAC.

“We caution that this unnecessary action of NAFDAC is detrimental to the survival of the concerned indigenous industrial operators.

“This is worrisome as it comes at the expense of the jobs and livelihoods of workers and all those involved in the value chain. It is counterproductive as it will open up the market for illicit, sub-standard, and unregulated products,” MAN said.

Similarly, the Nigerian Employers’ Consultative Association (NECA) has described the ban as a serious regulatory misstep with far reaching economic and governance implications.

NECA said: “The continued enforcement is already disrupting legitimate businesses, unsettling ongoing investments, placing thousands of jobs at risk, and weakening confidence in Nigeria’s regulatory stability at a time when investor trust is critically important.

“The current approach is misdirected. It disproportionately targets compliant and regulated manufacturers while failing to address the real drivers of underage access and the growing challenge of illicit substance abuse across the country.”

The WHO report has also bolstered the campaign of the Corporate Accountability and Public Participation Africa (CAPPA) for higher taxation on SSBs in Nigeria.  On January 23, a healthy food advocate at CAPPA, Mr. Robert Egbe, wrote that Nigeria’s shift toward a pro-health review of the tax payable by manufacturers of non-alcoholic, sweetened, and carbonated drinks, commonly known SSBs, has reached a critical moment.

Egbe wrote that in November, the Senate Joint Committee on Finance, Customs and Excise convened a public hearing in Abuja to consider a bill seeking to amend the existing excise duty framework for SSBs.

He hailed the bill before the National Assembly, formally titled, “A Bill for an Act to Amend Section 21(3) of the Customs, Excise Tariffs, Etc. (Consolidation) Act to Replace the Fixed Ten Naira (N10) Per Litre Excise Duty on Non-Alcoholic, Carbonated Sugar-Sweetened Beverages with a Percentage Levy Based on Retail Price, and to Provide for the Earmarking of a Portion of the Revenue for Health Promotion and Disease Prevention Programmes” as a significant policy turning point.

He said: “Globally, SSBs are scientifically recognised as major dietary drivers of obesity, type 2 diabetes, cardiovascular diseases, childhood malnutrition, and premature death. In Nigeria, consumption of sugary drinks – particularly among children and young adults – has risen sharply. Non-communicable diseases now account for almost 30 percent of annual deaths, placing enormous strain on families and overwhelming an already fragile health system.  However, the current tax level is far too weak to be effective.

“A fixed N10 per litre duty represents a negligible fraction of the retail price of sugary drinks. In 2021, a 33cl bottle of soft drink sold for N100–N150, meaning manufacturers paid less than N3 per bottle in excise duty. Today, that same bottle costs between N350 and N500, yet the tax remains unchanged.

“The result is a levy that barely affects shelf prices, fails to discourage consumption, does not incentivise reformulation, and is easily absorbed by manufacturers.

Against this backdrop, the National Assembly’s proposed amendment to the excise duty framework is not only timely but essential. A retail-price-based SSB tax would meaningfully reduce consumption and encourage manufacturers to lower sugar content, thereby reducing health risks.”

But the Chief Executive Officer of Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, has expressed serious concern over renewed calls in some quarters for the imposition of additional taxes on sugar-sweetened non-alcoholic beverages in Nigeria.

Yusuf argued that while public health challenges such as diabetes and cardiovascular diseases undoubtedly warrant urgent attention, the proposition of a sugar-specific tax is misplaced, economically risky, and weakly supported by empirical evidence.

He pointed out that advocacy for sugar taxation in Nigeria is largely driven by externally derived policy templates, particularly those associated with global health institutions.

“However, global best practice does not support sugar taxation as a sustainable or standalone solution to non-communicable diseases—especially in economies characterised by high inflation, weak purchasing power, fragile industrial recovery, and widespread poverty, such as Nigeria.

He warned that the non-alcoholic beverages are among the most heavily taxed and cost-pressured businesses in the Nigerian economy. “It existing fiscal obligations include 30 per cent Company Income Tax; 7.5 per cent Value-Added Tax (VAT); N10 per litre excise duty; 4.0 per cent National Development Levy on assessable profits and 4.0 per cen tFOB levy on imported inputs.

“Others are import duties of 5–15 per cent on intermediate raw materials; 0.5 per cent ECOWAS levy; property taxes at sub-national levels and multiple state and local government levies

“These fiscal pressures are further compounded by Nigeria’s challenging operating environment, including high energy costs, prohibitive logistics expenses, exchange-rate volatility, and elevated interest rates. The cumulative effect has been rising production costs, shrinking margins, subdued investment appetite, and higher consumer prices.

“Notably, retail prices of many non-alcoholic beverages have already increased by approximately 50 percent over the past two years, significantly eroding affordability even in the absence of any new tax measures,” Yusuf said.