Heineken to invest 400 mln euros in Congo over 5yrs

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* Seeks to upgrade Bralima brewery, build new one
* Sees strong growth potential in Congo beer market (Adds quotes, details)

Heineken (HEIN.AS) plans to invest 400 million euros ($561 mln) in its Bralima breweries in Democratic Republic of Congo over the next five years, to tap into the country’s rapidly growing population, Bralima said on Wednesday.

Hans van Mameren, Bralima’s managing director, said the outlook was positive despite uncertainity hanging over elections, as economic growth looked robust and any boost to infrastructure would see new markets open rapidly.

Bralima, which has been majority-owned by Heineken since 1986, has been operating in Congo since 1923 and makes the country’s most popular beer, Primus.

Mameren said 250 million euros would be spent on renovating the original brewery in Kinshasa and building a new one 40 km (35 miles) away. Another 150 million euros will be used to buy equipment and improve other breweries across the country.

Congo is due to hold its second post-war election on Nov. 28 and the capital has already seen several violent protests.

Yet despite the political uncertainty and increased tensions, Mameren believes the country’s economy will continue to grow, as will people’s thirst for beer. “Even if they fight a war in parts of Congo, the economy keeps going,” he said.

Congo’s annual per capita consumption of beer is just 3 litres, as opposed to 20 litres in Nigeria and 30 litres in neighbouring Congo Brazzaville, according to Mameren.

Mameren said expansion is inevitable with population growth at around 3 percent and roughly one third of the country’s 67 million people still unreachable by road.

“Everyone can see if you put a minimum of infrastructure in this country, it immediately opens up markets, it’s all about access,” Mameren said, pointing at vast roadless areas on a map.

When the road between Kisangani, in the centre of the country, and Beni, in the far east opened two years ago, Bralima’s Kisangani brewery raised its output by more than 500 percent, he added.

Congo’s vast infrastructure gap is far off being bridged but some roads are slowly being built on the back of foreign aid and a $6 billion minerals-for-infrastructure deal with China.

But transport remains the biggest challenge, with beer often travelling hundreds of kilometres by road or river to reach its destination, pushing up the price, according to Mameren.

“If you sell it around the chimney it’s fine, but if you have to transport it… it’s ludicrously expensive,” he stated.

Although Congo’s business climate remains one of the most hostile in the world and tax is as high as 40 percent, Mameren believes the nature of their product protects them from the worst excesses of corruption and government hassle.

“We’re producing the cheapest luxury in this country; if there was a situation where there was no beer, the population would be very surprised to say the least,” he said. ($1 = 0.712 Euros)