The Spirits and Wines Association of Nigeria (SWAN) has initiated a comprehensive sanitisation of the industry to tackle the growing menace of illicit trade. Despite significant progress over the years, industry analysts note that the sector is hindered by critical challenges, particularly the rising incidence of illegal activities. These activities have proven difficult to resolve and are negatively impacting government revenue. According to SWAN, the Nigerian government lost an estimated N428 billion in revenue due to these illicit practices.
Scope of Illicit Trade
Wines and spirits are integral to Nigerian social life, featuring prominently at weddings, birthdays, naming ceremonies, business engagements, and weekend gatherings. However, the prevalence of illicit trade poses serious risks to public health, legitimate businesses, and government revenue. A 2024 survey by Euromonitor revealed that the level of illicit trade in spirits and wines in Nigeria is about 40 percent, meaning that for every five bottles sold, two are from illicit sources. This highlights the substantial impact of the problem.
Illicit trade in the industry encompasses economic crimes such as tax evasion, smuggling, counterfeit packaging, market distortions, and revenue losses. SWAN, the umbrella body for businesses involved in manufacturing, importation, distribution, and marketing of spirits, wines, and other alcohol in Nigeria, is committed to sanitising the alcohol market and promoting best practices and high ethical standards.
Workshop and Stakeholder Engagement
As an immediate step, SWAN organised a high-level workshop at the Continental Hotel in Abuja, bringing together key players across the value chain. Participants unanimously resolved to combat fake and adulterated alcoholic products that threaten lives and livelihoods. The workshop included regulatory agencies, law enforcement bodies, manufacturers, distributors, legislators, senior media practitioners, the diplomatic community, and international organisations such as Interpol and the Alliance Against Counterfeit Spirits (AACS).
SWAN, comprising notable organisations like Bacardi, Brian Munro Limited, Diageo, Guinness Nigeria, Moët Hennessy, Nigerian Bottling Company, Nigerian Breweries, Pernod Ricard Nigeria, and William Grants & Sons, believes that fragmented enforcement cannot defeat organised criminal networks. The association notes that illicit trade exposes weaknesses in regulation, enforcement, border control, and market surveillance, while Nigeria's porous borders facilitate smuggling of untaxed and unverified products.
Key Speeches and Insights
In his opening remarks, Michael Ehindero, Managing Director of Pernod Ricard and President of SWAN, described illicit trade as a direct threat to business integrity and human life. He emphasised the urgency of collective action, stating, "Illicit trade, defined as the production, importation, or sale of goods outside regulatory frameworks, poses risks to consumer protection, government revenue, and legitimate businesses. It includes counterfeiting, smuggling, illegal production, tax evasion, and diversion of legitimate products. This is a global challenge with significant consequences for public health, government revenues, and economic development."
Ehindero highlighted that counterfeiters increasingly replicate trusted brands, producing and distributing illicit products outside regulated systems. He added, "Beyond the human cost, illicit trade has a devastating impact on our economy. Governments lose billions in tax revenue that should support education, healthcare, infrastructure, and public safety. Legitimate businesses are unfairly undercut, jobs are lost, and investor confidence is shaken. This is not a victimless crime; it weakens entire value chains and slows national development."
SWAN Director-General Tony Okwoju called for stronger stakeholder-led enforcement, noting that illicit operators do not pay taxes and that the trend has major implications for government revenue. He also highlighted ongoing collaboration with regulators like NAFDAC.
David Francis, Managing Director of AACS, provided a global perspective, noting the increasing sophistication of counterfeit operations. He explained that fake packaging materials are often mass-produced abroad and shipped into local markets. "They're becoming organised into gangs and well-organised networks. The quality of fake goods coming from China makes it challenging for consumers to spot fakes. Labels, cartons, bottles, and caps are all part of a do-it-yourself counterfeiting kit entering the domestic market. It is crucial to stop these products from entering the market," he said. Francis also clarified that counterfeit is a subset of illicit trade, which includes tax-evaded, smuggled, and parallel products.
Media expert Kingsley Uranta called for stronger investigative journalism to expose the networks behind illicit trade.
Regulatory Perspectives
Regulatory agencies acknowledged the growing threat and outlined interventions. The Federal Competition and Consumer Protection Commission (FCCPC) described the situation as a serious public health and economic challenge. Executive Vice Chairman Tunji Bello warned that illicit alcohol trade is a "multi-dimensional crisis" affecting consumer safety, market integrity, and public revenue, stressing that it touches on consumer protection, health protection, public revenue, public safety, and market integrity.
Assistant-Comptroller of Customs Kolapo Oladeji pointed to ongoing efforts to combat smuggling and strengthen border controls, while calling for improved policy frameworks. He noted the agency's role in licensing local manufacturers, collecting excise duties, and enforcing fiscal policies. "We are faced with smuggling, tax evasion, and counterfeiting, with smuggled products competing with local manufacturers who pay taxes regularly," he said, stressing the need for stronger regulatory and legal frameworks, improved tax policies, and enhanced border control.
Other bodies, including the Standards Organisation of Nigeria (SON) and the Nigeria Customs Service (NCS), reaffirmed their commitment to enforcement but emphasised the need for a unified, multi-stakeholder approach. Ishaku Mohammed, speaking for SON, stated, "SON remains committed to setting and promoting standards for quality and safety. However, tackling illicit trade requires coordinated efforts from multiple stakeholders. Effective enforcement, intelligence, industry compliance, and consumer awareness must work together for lasting results."
Recommendations and Way Forward
Deliberations produced recommendations including the creation of a formal multi-stakeholder coordination platform, intelligence-led enforcement strategies, increased investigative journalism, and strengthening of laws. Participants also emphasised sustained public awareness campaigns, whistleblower mechanisms, and tighter supply chain controls. With SWAN declaring an all-out offensive and stakeholders pledging sustained collaboration, there is cautious optimism that the Abuja engagement marks a turning point in the fight against illicit trade.
