Guinness Nigeria Plc plans to increase exports to improve sales and generate more foreign exchange as the country’s second-largest brewer battles to overcome an economic slump in its home market.
Bloomberg reports that the unit of London-based Diageo Plc will consider selling Guinness stout and the herbal drink Orijin in South Africa to boost the proportion of beverages it sends to international markets, Chief Executive Officer Peter Ndegwa, 48, said in a Sept. 9 interview at the company’s office in Lagos, the commercial capital.
That will help resolve the brewer’s shortage of foreign currency in Nigeria, which the beverage maker needs to pay for imported goods.
“With all the challenges we have had with foreign currency availability, we realize that export is a great opportunity to gain foreign exchange and stabilize,” Ndegwa said. “We have had a lot of inquiries from South Africa. We are currently in the process of seeing how we can export some of those brands to the country.”
Heineken NV is also expanding in South Africa with the recent introduction of Sol Mexican lager, part of a plan to boost its market share in a country dominated by SABMiller Plc.
Generating foreign currency from exports would help Guinness Nigeria offset a scarcity of dollars in its home market caused partly by a slump in oil revenue, the country’s biggest earner. The economy is on track to shrink 1.8 percent this year, according to the International Monetary Fund. That would be Nigeria’s first full-year contraction since 1991, according to data from the nation’s statistics agency.
Nestle Nigeria Plc, a unit of the world’s biggest food company, warned last month that a lack of foreign currency and the highest inflation in nearly 11 years would hurt profit margins.
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