A beer-loving MP-elect once arrested for illegal brewing is hoping the Move Forward Party’s election victory can give him a long-awaited shot at breaking up a 470-billion-baht alcohol duopoly of two of the country’s wealthiest families.
Brewer-turned-politician Taopiphop Limjittrakorn has been fighting to overhaul strict regulations for years, taking on Boon Rawd Brewery and ThaiBev, which have long had a stranglehold on the production of alcohol.
After winning the most seats in the May 14 electon, Move Forward this week reached an agreement with prospective coalition partners that include measures to “abolish monopolies and promote fair competition in all industries, such as alcoholic beverages”.
“The progressive alcohol bill is not only a bill, it is a political project,” said Mr Taopiphop, 34, who was re-elected in Bangkok Constituency 22, in an interview at his Taopiphop Bar Project on Charoen Rat Road.
“Now, I’m gathering all the stakeholders in this policy to make it happen as smoothly as I can because I realise that we are not the opposition any more. We are government.”
Boon Rawd, which makes Singha and Leo beers, and ThaiBev, the brewer of Chang, did not immediately respond to questions from Reuters.
Boon Rawd, the country’s first brewery founded in 1933, is owned and controlled by the Bhirombhakdi family, the country’s 15th richest, according to Forbes magazine. ThaiBev was founded by Charoen Sirivadhanabhakdi, ranked by Forbes as the country’s third-richest person with a net worth of $14 billion.
If Move Forward is able to lead the government and open up the alcohol sector, the two companies may see short-term effects on their performance because of new competitors, said Damien Yeo, consumer and retail analyst at the research firm BMI.
“Over the long run, both ThaiBev and Boon Rawd have plenty going for them that will help them maintain a healthy lead over any potential new competitors,” Mr Yeo said, pointing to both firms’ better understanding of the market and regulatory issues.
‘Not an extremist’
More than half of the country’s alcoholic drinks market, valued at about 470 billion baht in 2020, consists of beer.
Boon Rawd controls a 57.9% share of the beer market followed by Singapore-listed ThaiBev at 34.3% and Thai Asia Pacific Brewery at 4.7%, according to a February 2022 report by Krungsri Research.
ThaiBev is also the runaway leader in the spirits market with a 59.5% share, with the second-place player holding only 8% of the segment, according to Krungsri Research.
Through an amendment to the excise laws, which failed to make it through parliament previously, Mr Taopiphop said he was aiming to remove high-entry barriers for the alcohol industry that largely favour big firms like Boon Rawd and ThaiBev.
The aim would be help small domestic brewers gain at least 10% of the beer market within a decade, he said.
In a social media post on May 19 after Move Forward’s election win, Piti Bhirombhakdi, who is on the board of Boon Rawd, said he backed the liberalisation of the industry.
“There will be some impact but in free trade we have competition. We will have to adjust our plan,” he said in reply to a comment on Facebook.
On a May 12 earnings call, ahead of the polls, a ThaiBev executive said the company was alert for new regulations. The company’s stock is trading at its lowest level since early November.
“We’ve been watching this closely for each party, and what is their policy,” said senior executive vice-president Ueychai Tantha-Obhas. “We just prepare for any outcome.”
A lawyer who became a tour guide before turning to brewing, Mr Taopiphop said he planned to follow up on regulatory easing with further legislation on rationalising restrictive alcohol advertising and allowing 24-hour alcohol sales.
“I’m not an extremist,” he said. “I want to drink good beer.”