Diageo has hailed a deal with Kenya's Government as the perfect case study for reducing illicit alcohol consumption in Africa at the same time as increasing beer sales across the continent.

Diageo is encouraging other African countries to enter similar deals, following success of the five-year-old operation in Kenya, the group's managing director for Africa, Nick Blazquez, told just-drinks this week.

Diageo and Kenya's Government signed an agreement five years ago to develop a low cost beer brand that could compete on price with illicit alcohol consumed widely across the country. Authorities initially slashed duty tax on the beer and have now waived it altogther.

A significant proportion of alcohol consumed in Sub-Saharan Africa is "noncommercial", according to a report by the drinks industry-funded International Center for Alcohol Policies. The report, published late last year, cites World Health Organisation estimates of illicit alcohol consumption.

Senator Keg beer, which costs around KES20 (US$0.26), is sold in 33cl plastic mugs at hand pumps around Kenya.

It has risen to become one the most popular beers sold by Diageo in Africa, level with Tusker on annual volumes of roughly 2m hectolitres. Among Diageo brands in Africa, only Malta Guinness and Guinness have higher annual volume sales.

Blazquez described the Kenya deal as a "win, win, win" situation. "Consumers get a healthier product, the Government gets more revenue and we have been able to grow our business."

Expanding the idea into other African countries "is something we are looking at", he said, adding that the drinks giant has promoted its Kenya deal to other Governments as a case study.

Hopes of broadening the scheme across the continent form part of Diageo's strategy to invest more in its African beer operations.

Africa overtook Europe as Diageo's most lucrative beer market in the group's most recent fiscal year, to the end of June. Africa accounted for 39% of Diageo's net beer sales during the period, compared to 38% for Europe, while Nigerians now drink more Guinness than the Irish.

Africa's beer market has grown by around 8% per year in volume terms since 2005, reaching more than 90m hectolitres in 2008, Diageo said at a global media briefing on beer this week.

"We fully expect growth to continue," said Blazquez in the briefing. He added that there is an estimated 100m young people expected to reach the legal drinking age across the continent within the next few years.

Instead of building breweries, Diageo plans to focus on partner deals to help it expand across Africa. For example, the group is building a brewery with Heineken in South Africa and has also extended a venture deal with Heineken and Namibia Breweries in the country, by far the biggest beer market on the continent.

It has this week also announced a deal to sell Guinness in Angola, via a deal with Portuguese drinks group Unicer. Among Africa's ten largest beer markets, Angola is one of three in which Diageo does not have a significant presence.

"We compliment our partners' portfolios and we work very hard on that," said Blazquez.

Football sponsorship is another big part of the success story in Africa for Guinness, in particular.

The brand has ambassadors such as Michael Essien, who plays for Chelsea in the English Premier League and is also likely to play for Ghana in both the Africa Cup of Nations and the World Cup in South Africa next year.

Guinness net sales in Africa rose by 18% in Diageo's most recent full-year, taking global Guinness sales to the GBP1bn (US$1.6bn) mark.

To read a recent just-drinks interview with Brian Duffy, global brand director for Guinness, click here.