Kenya’s underground alcohol market has ballooned into a $1.57 billion shadow economy that now accounts for 60 percent of all alcohol consumed in the country, according to a 2025 Euromonitor International study commissioned by the Alcoholic Beverages Association of Kenya and cited by the Anti-Counterfeit Authority.
The trade cost the National Treasury about $930 million in lost fiscal revenue in 2024, money that could have supported hospitals, schools and other public services. Illicit volumes grew 27 percent between 2022 and 2024, outpacing the legal market.
The human toll is stark. The World Health Organization estimates that alcohol consumption kills at least 14,000 Kenyans every year through noncommunicable diseases, traffic crashes, violence and acute toxicity. Many of those deaths are linked to unregulated or adulterated drinks.
“Adulterants like industrial methanol are absorbed rapidly,” a Nairobi-based public health expert and consultant physician told The Star. “Methanol metabolises into formic acid, a potent toxin that attacks the optic nerve, causing permanent blindness and destroys kidney and liver tissues within hours.”
Homemade brews such as chang’aa, busaa and muratina make up the bulk of the volume, about two-thirds of illicit alcohol by volume. Yet the biggest financial losses stem from tax leakage, counterfeit brands and smuggling. Tax leakage alone accounts for roughly $560 million to $625 million, counterfeit and illicit brands about $496 million, and smuggled alcohol another $178 million, according to the study.
Illicit spirits can cost up to 80 percent less than legal alternatives. Affordability drives demand: 74 percent of consumers cite price as a key factor. High excise taxes on legitimate products have widened the gap. Undenatured ethanol costs about $1 per litre in Kenya because of taxes, compared with about $0.30 in Uganda, creating strong incentives for cross-border smuggling.
Retail Trade Association of Kenya chief executive Wambui Mbarire said repeated tax increases have pushed consumers toward the underground market. “Repeated tax increases on alcohol have created a situation where nearly half, about 44 per cent, of all alcohol consumed in Kenya is now illicit,” she said.
Industry Principal Secretary Dr. Juma Mukhwana described the findings as a wake-up call. “The illicit market has grown bigger than the legal one. It is organised and mainstream. We must protect the legal market while preserving cultural traditions.”
ABAK Chairman Eric Githua said the study aimed to quantify the problem for policymakers. “Our aim was to help the government understand the size of the problem and identify solutions.” He warned that high taxes are driving consumers to cheaper, illegal options.
Assistant Inspector General Cunningham Suiyanka called the situation dire. “This report is a warning. My biggest enemy is a counterfeit drink. It’s deadlier than chang’aa.”
Beverly Opora of the Ministry of Interior linked the trade to broader security concerns. “It’s a major internal security risk. Many crimes are committed under its influence.”
Counterfeiters wash genuine bottles, clone labels and tax stamps, then refill them with cheap or dangerous liquor. Smuggled ethanol feeds illegal distilleries. Enforcement agencies, including the Kenya Revenue Authority, Kenya Bureau of Standards, Anti-Counterfeit Authority, NACADA and police, face a challenge that industry players say cannot be solved by raids alone.
In July, the United Kingdom issued a travel advisory urging visitors to Kenya to avoid homemade, unsealed or unusually cheap alcoholic drinks and to buy only from trusted, licensed outlets.
The formal alcohol industry contributes 2.27 percent of total excise revenue and supports an estimated 400,000 direct and indirect jobs. Sector players, regulators and consumer groups argue that any lasting response must combine stronger enforcement with structural reforms that address the price gap between legal and illicit products.
As one editorial in The Star put it, the $1.57 billion illicit alcohol economy has grown far beyond a nuisance. It is a sprawling criminal enterprise that steals from the Treasury, threatens legitimate businesses and puts lives at risk.
Linda Ikeji (Nigeria)
Most Impactful Work: Her highly popular online platform, Linda Ikeji’s Blog.
Short Bio: Linda Ikeji is a Nigerian media entrepreneur and blogger who pioneered digital news publishing in
Nigeria with her blog. What started as a gossip blog has evolved into one of the most visited news and entertainment platforms on the continent, making her a significant influencer in African media.
deano
A British man on safari walks into a bar far out in the reaches of a game reserve in Southern Africa, he stays at the bar for a while shooting the shit with the bartender and drinking like a fish, he offer to buy the barkeep a round and since no one else is within 2km of their small oasis of liquor the barkeep obliges. The englishman goes off to the bathroom to have a good old go at the porcelain, he\’s back and ready for a few more whiskeys. He\’s just sat down when suddenly in the distance he hears a scream. He looks over his shoulder and dismisses it as nothing, he turns to the barkeep and orders a drink, takes a sip and hears the scream again. He looks at the barkeep who just shrugs it off. A minute or two later he and the barman hear it again and go outside to take a look. They see a lone figure running towards them screaming, he spots them and lets out a cry, RUN!!!!! HE\”S COMING!!!!!
The barkeep and the Englishman both look at the terrified bedraggled sight before them, and try to calm him down, but he\’s completely inconsolable. They give him water and finally manage to get a word out of him but he struggles free from their grasp and run away screaming.
A few minutes later the same thing happens with a whole group of men running in and screaming, he\’s coming, he\’s coming the barkeep grabs hold of one of the men as he tries to sprint past the bar and tries to get information out of him, again no response other than terrified gibberish.
The barkeep and his customer are starting to get worried, they start to pack up before another group of horrified natives run up to the bar most of them flee but one tries to hide behind the bar, the barkeep pulls out a shotgun and points it at the terrified man\’s face, finally managing to coax some words out of him. \”He\’s coming for us, Vernon Koekemoer is coming for us, we have to hide!!! We have to get out of here.\” He gets up and tries to run but the barkeep grabs him, feeling trapped in a panic he grabs the barkeeps shotgun and blows his own head off. The Englishman and the barkeep look at each other starting to really panic now.
They look out of the window and off in the distance they see a tornado coming towards the bar, at the bottom of the tornado they see the hugest beast of a man they have ever seen, as he gets closer they spot that he is riding a rhinocerous and using a crocodile as a riding whip, with each smack of the crocodile across the back of the rhino the louder is screams and the faster it runs, the tornado following it getting ever larger.
The 2 look at each other and start to fortify their position, they\’ve got a gun and they\’re waaay to drunk to run, so they start piling bar stool and tables and anything they can get their hands on to make sure they\’ll be safe when he arrives. They\’re not gonna make it, they can see the man slowing down his rhino, by now the crocodile is nothing but reptile paste on the bruised rump of the half dead rhino, the rhino drops down dead from exhaustion and crashes to the ground right outside the bar the tornado loses it\’s last breath in a cloud of dust as the huge man crashes his way through the make shift barricade and charges up towards the bar where the 2 men have taken shelter, he grabs a bottle of the hardest liquor on the shelf and down the entire litre in 1 gulp, he peers over the bar sobbing and sees the 2 defenders cowering down behind the crates of beer, they look up at the mans\’ face and he stares at them with a look of complete and utter hopelessness, he stares at them for a half second and half screams, half sobs, \”Oh my god what are you still doing here!!! WE HAVE TO GET OUT OF HERE NOW!!!! Vernon Koekemoer is coming!!!!\”
retromirage
Did you know that another country lies within the borders of South Africa? The Kingdom of Lesotho is a sovereign state that is located in the Drakensberg Mountain area. The mountainous country has been nicknamed “the Kingdom in the Sky” thanks to the magnificent scenery and landscapes!