In 2015, the Indonesian government banned sales of alcohol beverages with an ABV of between 1-5% from mini-marts, small shops and kiosks. According to Diageo, the second largest brewer in the country, this had an immediate commercial effect; while Multi Bintang (MB), Indonesia’s largest brewer, and a division of Heineken, also suffered declining sales. Large areas of Indonesia simply no longer have access to supermarkets that are allowed to sell beer. Ban on Indonesian mini-marts stimulates investment in non-alcoholic beers Global brewers are increasingly seeking to target Muslims around the world with non-alcoholic beers (NABs) that give drinkers a hint of “Western glamour” while also being consistent with Muslim values to avoid inebriation. The escalation of NAB innovation means that a third of all new beer launches in Indonesia so far in 2016 have been non-alcoholic compared to just one in 25 in 2014. Things could get even better for non-alcohol beer (or much worse) While the number of number of Indonesian Muslims is expected to grow consistently over the next few decades, this suggests a market with plenty of long-term potential for NABs, particularly given Indonesia’s tough regulatory environment for full-strength beer. Additionally, brewers of NAB are now selling to a younger global Muslim generation who differ greatly from their older members, and are actively seeking to lead more Western-style lifestyles. The growing NAB segment would get another shot in the arm if Islamist lawmakers succeed in their current attempts to pass an even stricter bill through the House of Representatives. This would impose a blanket ban on the production, distribution and consumption of any alcohol with an ABV between 1% and 55%, which are currently available in larger supermarkets, restaurants, cafes and hotels. The danger for investors is that if such a bill was passed – and there have been numerous attempts by conservatives in recent years to push such prohibition measures – it could then mean the first step towards a ban on NABs too. After all, the government explained its ban on alcohol sales in mini-marts as a means to “protect the morals and culture of Indonesian society”. It could easily be argued by conservative lawmakers that NABs create a desire for the real thing and maybe even encourage consumers to enter what would by then have become a vibrant black market for alcohol. Jonny Forsyth is Mintel’s Global Drinks Analys, responsible for researching and writing all of Mintel’s UK drinks reports. He brings ten years of experience working in the marketing industry, with roles at Starcom Mediavest, AB-Inbev, and Trinity Mirror. He is a regular contributor in global and national media outlets such as BBC, CNBC and Bloomberg. You might also be interested in: Beer sales bubble in wine countries India’s growing taste for craft beer presents opportunities for flavour innovation Does Brexit bring more opportunities for British craft beer brands? Can beer save the world?