Thailand: For advertisers of beer and other alcoholic drinks, this week could be their last hurrah

In the beer bars outside the upscale World Trade Centre shopping mall in downtown Bangkok, the competition is fierce.

For advertisers of beer and other alcoholic drinks, this week could be their last hurrah -- at least for a while, Asia Media posted on November 29th. Through its Food and Drug Administration (FDA) agency, Thailand's conservative new government wants all forms of advertising for alcohol banned -- in the media, in outdoor displays and on beer promoters' outfits too.

A howl of protest has risen from Thailand's big breweries and liquor importers and distributors, who have lobbied fiercely to scuttle the ban. But pro-ban groups have been pressing Prime Minister Surayud Chulanont to use the powers of his office to ram it past objections.

In an on-again, off-again war of breweries versus a conservative mainstream struggling to quell a huge national drinking problem, this battle over advertising is going down to the wire. The ban was due to take effect on Dec 3, but the Council of State, a legal body, declared that the FDA had no authority to impose it.

Yesterday, the Cabinet stood firm, asking the council to reconsider its decision. That may delay the implementation date. It was the liquor industry that had referred the proposed ban to the council earlier.

The Federation on Alcohol Control of Thailand (Fact) represents 24 associations of alcohol importers and producers, as well as hotels and restaurants.

The industry cites a slew of arguments against the ban -- that advertising has no real effect in promoting drinking; that their brands will suffer; that competition will suffer; that jobs will be lost, especially for young college girls who work part-time as beer promoters.

It says the ban violates World Trade Organization rules; that it will end up unfairly targeting some liquor producers and not others; that tourism will suffer; that sports and entertainment events like the Johnny Walker Classic golf tournament and the Bangkok Rock Festival will collapse if sponsorship from liquor brands evaporates.

Thais are among the world's highest consumers of alcohol, ranking fifth after Portugal, Ireland, the Bahamas and the Czech Republic in a survey done in 2001. The same survey found that Thais' alcohol consumption had gone up 67 per cent in 10 years.

Drinking is an issue across all social classes of Thailand's 63 million people. In relatively poor rural villages, there is often little else to do on long sultry evenings than down Mekong whisky or Chang beer. The implications of the proposed ban are huge.

Media stocks dipped after the plan became known. The Ministry of Public Health said the ban could cost the media up to 2.5 billion baht (S$105.5 million) in advertising revenue. The problem however, is that previous attempts at curbing the reach of liquor giants have had patchy results.

Alcohol consumption has increased steadily even after a ban was imposed three years ago on booze ads appearing on television from 5am to 10pm. Despite fines for violators, the number of such advertisements placed illegally during those hours was up 126 per cent this April from August 2005.

Thais consumed 759 million litres of spirits in 2003. That rose to 791 million litres in 2005, according to the World Health Organization. Beer intake rose to 1.6 billion litres from 1.5 billion in the same period.

Underage drinking is a rising problem, and among young drinkers, there is a sharp rise in women drinkers. Drinking has also brought misery to many.

There is the annual festival carnage from drunk driving injuries and deaths. Last April's Songkran holidays saw 506 killed and 6,194 injured in road accidents -- about half attributed to alcohol.

Thailand has seen a running battle over alcohol especially since Beer Chang was launched in the mid-1990s.

Elbowing out Singha Beer with aggressively low pricing and deep and wide distribution in rural markets, Beer Chang now has around 80 per cent of the country's US$2 billion (S$3.1 billion) beer market.

In March last year, sustained protests by thousands of Buddhist monks forced the company to abandon its plan to list on the Stock Exchange of Thailand. It eventually listed on the Stock Exchange of Singapore.

Uncertainty and confusion are muddying the spat over advertising.

Beer Chang, for instance, is a sponsor of the English football club Everton, its logo appearing on the team's jerseys. Those against the ban on advertising ask what TV stations are to do when they broadcast an Everton game.

Also, some beer brands put their logos on their non-alcoholic products as well. The Ministry of Public Health wants that to stop too.

Whether advertising spurs drinking is also a matter of furious debate, but there is no shortage of studies that say there is a clear correlation between the two.

A 2003 study by the American National Bureau of Economic Research concluded that a complete ban on alcohol advertising could reduce monthly levels of youth drinking by 24 per cent, and youth binge drinking by about 42 per cent.

On Monday, some 300 pro-ban protesters gathered at the beer bars at the World Trade Centre to decry the Council of State's finding that the FDA had no power to impose the ban.

As Public Health Minister Mongkol Na Songkhla said last month: "Measures to control drinking will be enforced... to reduce the number of deaths and health problems due to drinking alcohol, and road accidents." But battling the big breweries is proving to be easier said than done.

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