Heineken said the ban wont resolve underage drinking

Heineken said the ban won't resolve underage drinking

Heineken has said it is "very concerned" after Indonesian authorities implemented a ban on beer sales in the country's small stores.

The company, which is has a majority stake in Indonesian brewer PT Multi Bintang, said the new legislation could damage retail sales and tourism. It also said the move will not resolve underage drinking, which is the main motivation for the ban.

"We are engaged in an active and urgent stakeholder dialogue with the relevant authorities and other experts to develop alternative scenarios that tackle the underage-drinking issue without hurting the local economy," Heineken said in a statement.

The legislation, which came into effect today, outlaws the sale of alcohol between 1% and 5% abv in convenience stores, news agencies have reported. Restaurants and supermarkets will still be allowed to sell alcohol, and the trade ministry has exempted the tourist island of Bali from the ban.

However, speaking to the Wall Street Journal today, Diageo's Indonesia head, John Galvin, said: "We’re talking about beer not being available in wide swaths of the country."

In a statement, Diago said it had been trying to delay the legislation and that it is ready to work with the government on "real pragmatic solutions".

According to Heineken, the new rules will affect about 12% to 15% of outlets in Indonesia. The move follows reported pressure from some Indonesian legislators to enact a total alcohol ban in the country.

Japanese beverage makers have been investing heavily in the fast-growing soft drinks market in the predominately Muslim country. Last week, Asahi reportedly said it would launch new, low-calorie products aimed at women in the country after it opened a plant in West Java.