* Brewery in south Sudan mark of autonomy for officials
* $40 million investment shows growth in Africa
* Hurdles from infrastructure to legal obstacles
By Skye Wheeler
JUBA, Sudan, March 24 (Reuters) - The south Sudanese like to joke that alcohol has a special meaning for them: they fought a bloody two-decade long war so they could enjoy a cold beer at the end of a long, hot day.
This year -- the fourth since a peace deal between the mostly Christian south and the north, where alcohol is forbidden under Shariah law -- southerners will get their own beer from the region’s first factory, being built by brewer SABMiller.
A huge hangar covers giant boilers and tons of malt ready to start brewing a light lager that will, SABMiller hopes, quickly be taken up by the countless new bars and restaurants in the south’s capital, Juba.
“It’s a big step forward, a sign of development and shows confidence in the peace,” the south’s commerce ministry undersecretary John K. Panguir, told Reuters. “This is the one country, two systems in action.”
Continuing violence in Darfur, west Sudan, is distinct from the much longer north-south war; although there are concerns an International Criminal Court warrant for the arrest of Sudanese President Omar Hassan al Bashir on war crimes charges could help reignite the north-south conflict.
“Development is a key to stopping conflict,” SABMiller’s Juba brewery manager Ian Alsworth-Elvey told Reuters.
Originally from South Africa, London-based SABMiller is the world’s second biggest brewer -- and Africa’s biggest -- with a 90 percent share in South Africa and operations in Tanzania, Angola, Botswana and Uganda.
Like its competitor Diageo -- whose Guinness brand has been successful in Nigeria -- SABMiller has seen continued growth in Africa while economic downturn dampened mature western markets.
It announced its $40 million investment in south Sudan in December, noting that since the peace accord south Sudan has soaked up its products from Uganda and saying the time is right to tap into demand directly and get a head-start on rivals.
Ideological, cultural and religious differences and oil fuelled the war, but Khartoum’s 1983 Sudan-wide imposition of Islamic Law inflamed a southern insurgency that began the same year quickly escalated.
The main former rebel group now leads the south, which is semi-autonomous under the accord. With a 50 percent share of government oil revenues of about $1.5 billion a year the south is slowly trying to build missing roads, schools and hospitals.
It has already pushed out all Islamic banking, replaced Arabic with English as its official language and written its own secular school syllabus. The production of alcohol will add another degree of separation from the north.
“This is what we were fighting for, so we are free to do what we want,” Panguir said. Another official saw the planned factory as part of the implementation of the peace accord.
A flock of new civil servants and aid workers arrived after the peace deal, and with little else to spend their leisure cash on, they have been fuelling a boom in restaurants and cafes.
But Alsworth-Elvey says it’s the country’s more numerous smaller and less formal bars -- made often of metal sheeting and bamboo and blasting Congolese and Ugandan music -- that will be key to the venture’s success.
Selling plastic packets of liquor and lukewarm beer of whichever of the dozen or so brands are currently available, these have proliferated across the south since the peace made them legal.
Consumers usually pay between 4 (about $2) and 6 Sudanese pounds per bottle but wholesale prices vary with availability. The constancy of a cheaper SABMiller beer will give it a big advantage, Alsworth-Elvey said.
He is also sure that the new brand, designed to be “iconic” to southerners, will be a draw. The name and label design are still top secret, although the technicality of trade-marking the beer has exercised SABMiller’s lawyers.
“You can’t trademark an alcoholic product in Khartoum,” Alsworth-Elvey noted.
Other challenges have included the south’s devastated infrastructure, including a very poor road network: this is one Alsworth-Elvey said the company has successfully taken on before, for example in Angola.
SABMiller is hoping that eventually southern farmers will begin providing sorghum, but today everything from sugar to malt to 3.2 million brown 500 ml bottles has to be trucked in on bumpy roads from Kenya and Uganda.
Already, tens of trucks roll into Juba weekly rattling with crates. Alcohol tax is the same as for any other product although drivers say their load is often lightened at numerous informal military checkpoints.
Juba’s generators do not produce enough electricity for domestic use, let alone for industry.
Water is also a problem. A pump, a 4.8 km pipeline to the factory from the River Nile and water treatment centre are included in the investment budget.
SABMiller also had to negotiate land access in a place that until February had no land legislation.
To get a 99-year lease on 17.5 hectares it engaged the local Bari tribe directly. A Bari development group will get royalties from the 15,000 hectolitres of beer produced each month.
Some see an unhappy irony in the new factory -- a sign of normality -- producing beer, which is much abused by the war-ruined. Researchers in some areas say they have found entire villages drunk by midday. Alcoholism plagues the civil service.
“Even kids are drinking. We don’t know how to eradicate this problem,” Panguir said. Officials in Juba have tried to shut down bars during working hours, but with a weakened police administration have found this difficult push through. (Reporting by Skye Wheeler, additional reporting by David Jones; Editing by Sara Ledwith)