Nationalism Makes Laotian Beer a Success

Las Vegas SUN
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Today: December 30, 2005 at 12:6:45 PST

Nationalism Makes Laotian Beer a Success
By DENIS D. GRAY
ASSOCIATED PRESS

VIENTIANE, Laos (AP) - Inspired by Czech brews, propelled by
patriotism, Beerlao has snapped up 99 percent of its domestic market
and some international awards while forging a rarity in this
impoverished remnant of the communist world - a distinctive brand name.


Probably the only Laotian product that rings bells in the region or
beyond, Beerlao is also gearing up for an export drive and some
international promotion, which, until now, has been largely
word-of-mouth and Internet chat.

At home, Beerlao (Bia Lao in the Lao language) goes unchallenged, its
golden tiger head logo far more prominent than the red star of the
ruling communist party. The state-owned Lao Brewery Co. supports
schools, health facilities and sports competitions, paying an estimated
$32.5 million into state coffers this year - more than any other single
enterprise.

"National pride is a big part of our success," says marketing manager
Bounkanh Kounlabouth, underlining the company message: Drinking Beerlao
is good for the country.

The growing number of foreign tourists, many of them young backpackers,
likewise partake, especially since a can goes for the equivalent of 56
cents at many bars and restaurants.

Watching the sun set over the Mekong River while sipping a cold Beerlao
(side order of deep-fried crickets optional) has become a must-do for
visitors. And travelers returning home post comments on Internet sites
such as: "probably the best beer in the world," "decent beer but
massively hyped up," and "when is it coming to Sydney?"

So far only 1 percent of production is exported, mainly to Cambodia,
Vietnam, France, Japan, New Zealand, Australia and the United States.
It also is smuggled into neighboring Thailand, which puts onerous
restrictions on its import.

But Bounkanh said a factory to be built in southern Laos as an export
base will double production capacity to some 63 million gallons a year.


The enterprise, which traces its origins to French colonial times,
added dark brew and a light beer to its regular lager this year and
went into a 50-50 joint venture with Denmark's Carlsberg Breweries, the
world's No. 5 beer-maker.

"Laos is developing fast and many tourists are coming to it. The time
has come to offer more choices to drinkers," Carlsberg Vice President
Mogens Thomsen said when the deal was sealed in October.

Smooth, golden-colored and with a bouquet of rice substituting for the
more traditional barley, Beerlao has won awards in Europe, the United
States and New Zealand and was voted Asia's best beer of 2004 by Time
magazine.

With only 2.3 million Laotian drinkers, the domestic market is limited
but growing at about 10-15 percent a year. Consumption is estimated at
just 4 gallons per Laotian, compared with 21 gallons for Americans.

Czech brews, Bounkanh said, were Beerlao's prime inspiration, and he
and several other executives spent years studying beer-making in the
Czech Republic. Yeast and hops are imported from Germany and malt from
Belgium and France, but the rice is Laotian.

The company realizes that Beerlao's "full taste of happiness" and the
nationalist factor are not the only reasons for its success - a 40
percent tax on imported beer helps. This, however, will vanish in 2008
when Laos joins the Southeast Asian free trade zone.

Bounkanh knows imports will weaken Beerlao's grip on the market, but he
hopes exports will fill the shortfall.

Meanwhile, the company's modern, computerized brewery on the outskirts
of the capital, Vientiane, cannot work fast enough.

"Sometimes in the peak season we cannot meet the demand," Bounkanh said
while savoring a glass of Beerlao. "Why is it so good? It's fresh,
fresh beer. It's off the shelves in two weeks."

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On the Net:

Lao Brewery Co.: http://www.beer-lao.com


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