Non-alcoholic beer is the only alcoholic drinks category present in Saudi Arabia, as alcoholic drinks are banned under Islamic law. The COVID-19 pandemic resulted in a steep decline in non-alcohol beer sales in 2020, particularly in the on-trade.
Given that drinking alcohol is strictly prohibited in Saudi Arabia, with a ban on the sale and consumption of alcohol under Islamic Sharia law, which is the basis for the country’s legal code, and which is strictly complied with, alcoholic drinks packaging is a very restricted market in Saudi Arabia. The only product listed within alcoholic drinks in Saudi Arabia is non-alcoholic beer, with no production or importation of alcoholic drinks with an ABV of more than 0% in the country.
The beer category has seen limited new product development in Saudi Arabia in recent years. Pre-pandemic, there had been a greater focus on improving the marketing and positioning of existing products in the context of the implementation of 15% VAT in Saudi Arabia, which had contributed to a cautious spending environment.
The implementation of 15% VAT and subtle price increases have increasingly encouraged consumers to purchase multipacks available at discounts and in promotions. Packaging could have an important part to play in companies’ strategies over the forecast period, with simplification helping to keep down costs, while smaller pack sizes could help to prevent too great an increase in prices.
Packaging is expected to see a gradual recovery in both off- and on-trade volume terms over the forecast period, as Saudi Arabia enters a period of normalisation and economic activities pick up, with an increase in tourism also likely to be a key growth driver. Furthermore, there is potential for producers of non-alcoholic beer to tap into the prominent health and wellness trend, as consumers look for refreshing alternatives to soft drinks such as carbonates.
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Alcoholic Drinks Packaging
This is the aggregation of beer, cider/perry, RTDs/high-strength premixes, spirits and wine.
See All of Our DefinitionsThis report originates from Passport, our Alcoholic Drinks Packaging research and analysis database.
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