Business leaders from across several sectors have warned illicit trade is rapidly expanding in South Africa, threatening jobs, public health and investor confidence.
The issue took centre stage during the first day of the Proudly South African Buy Local Summit.
To raise public awareness about the far-reaching impact of illicit trading across industries, Proudly South African hosted a peaceful march on Monday during which a memorandum of demands was handed to the department of trade, industry and competition (DTIC).
The action aimed to highlight the damage caused by illicit trade and call on government and policymakers to implement stronger interventions to prevent further job losses.
The issue was unpacked during a panel discussion featuring GS1 South Africa CEO Zinhle Tyikwe, Aspen strategic trade development senior executive Dr Stavros Nicolaou, SA Canegrowers Association CEO Dr Thomas Funke, South African Breweries (SAB) senior manager of excise and tax Fatsani Banda and Steel and Engineering Industries Federation of Southern Africa CEO Tafadzwa Chibanguza.
Banda said buying local is closely tied to supporting legal markets.
“Buying local implicitly means buying legal and our conversation, drawing attention to the growth in illicit alcohol, was to exemplify that a growing illicit trade market hurts the economic multipliers SAB brings to this country,” she said.
Banda said the legal alcohol industry supports hundreds of thousands of livelihoods and contributes significantly to the economy.
“We are a value chain of 250,000 people. Our GDP contribution is R80bn and our tax contribution is close to R50bn. There are a lot of multipliers that go into the local economy we’ve established.”
She warned the illicit alcohol market continues to expand.
According to a 2025 study by Euromonitor International titled “Understanding the Illicit Alcohol Market in South Africa”, illicit alcohol accounts for 18% of the country’s total market volume, representing an estimated R25bn annually.
Fiscal losses to the state reached about R16.5bn in 2024.
Early this month, police pounced on makeshift factory which produced fake detergents from a shack in Villa Liza near Boksburg in Ekurhuleni. They were using original containers of brands popular like Unilever to sell the fake concoctions.
She said the Drinks Federation of South Africa has established a responsible trading task force to help curb the problem.
Banda said collaboration between government agencies such as the South African Revenue Service (Sars) and law enforcement will be critical to tackle the issue.
Nicolaou warned the illicit trade in pharmaceuticals poses severe public health risks.
“We are dealing with a significant societal malaise with illicit trade,” he said, noting estimates place the overall illicit market in South Africa at between R60bn and R400bn.
Nicolaou said the problem is particularly serious in the pharmaceutical sector, where counterfeit and substandard medicines can have life-threatening consequences.
He warned the rise in GLP-1 weight-loss drugs has seen a sharp increase in illegal products entering the market.
TimesLIVE
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