Latvia's cross-border alcohol trade is flourishing again

Alcohol for sale in Valka, on the Latvian-Estonian border
Alcohol for sale in Valka, on the Latvian-Estonian border Source: ERR

Despite the lowering of the alcohol excise duty and travel restrictions implemented to stop the spread of coronavirus, Latvia's cross border trade is going well.

Head of the Super Alko Latvian stores, Lauri Uibo, said their turnover had decreased by 90 percent during the emergency situation but now sales are as high as before. Due to the coronavirus crisis, the year's will be less profitable than last year's.

"When looking at turnovers and customers, then the parking lot is completely full during the weekends. Customers have returns and sales are very good. When the borders were opened in May, then gradually, people started coming and in July, everything happened in a full swing," Uibo said.

In July, last year, Estonia reduced the amount of alcohol excise duty to try and limit the border trade. Alko1000 manager Einar Visnapuu has not see the effects of it.

"The state announced they would reduce the excise duties through the media. But then people understood that in reality, not much is going to change. Money won't come to the state treasury and that's it," Visnapuu said.

However, in July, 86 percent more excise duty was received by the state.

Brewer A. Le Coq's manager Tarmo Noob said it is very difficult to evaluate the effectiveness of the decrease in excise duties, as the situation caused by the coronavirus has had a significant impact on consumer behavior.

"In practically every country, the restaurant and bar sectors have been hit. It is either severely restricted or closed, and it has meant that consumers have started to buy more, more strong alcoholic beverages, especially from shops," Noob said.

A Le Coq has offset the decline in sales due to restrictions with a 57 percent export growth and predicts growth will continue.


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Editor: Roberta Vaino

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