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Dutch government gave a grant of € 6.6 million to Heineken for ‘development aid’ through trade in Africa

23 March 2016

The Dutch government gave in recent years a € 6.6 million grant to Heineken for so-called development aid in Africa. Prime Minister Rutte praised Heineken in September 2015 during a speech to the UN, because of the purchase of beer barley from local farmers in Africa.

Research journalists of the Dutch television-program Zembla studied the impact of the € 1.3 million grant Heineken received from the Dutch government for the acquisition of two state breweries in Ethiopia.

Who benefited? The advantage for Heineken is obvious: net sales rose sharply and the company now controls 30% of the Ethiopian beer market. But that does not apply to the Ethiopian government: Heineken pays now - despite increased sales - less income tax than before the acquisition in 2011. In addition, Heineken paid also much less wage tax. That's because since the acquisition of the two breweries, 699 Ethiopians were dismissed by Heineken. The impact on poverty in the country and on the beer barley farmers who participate is unclear. The latter have a higher yield and a better price, but may only supply the breweries of Heineken.

An expert of the IMF judges the results of the Dutch policy as a loose-loose-win situation. A loss for the Ethiopian treasury, a loss for the personnel of the breweries and a win for Heineken.

Source: Zembla.vara.nl.

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