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Guinness Anchor, which has the largest market share of the three brewers in Malaysia, recently celebrated Guinness’s 250th anniversary with a concert near Kuala Lumpur featuring the Black Eyed Peas. The company had to create a separate area where alcohol could be served and agreed not to use the word ‘‘Guinness’’ at the concert or in advertising promoting the event.
Initially, Muslims were not allowed to attend; however, the authorities later changed their minds. The concert did not sell out, but about 16,000 people went through the gates. It is not known how many were Muslim.
‘‘We target our activities squarely towards the Malaysian Chinese and Malaysian Indian community bases,’’ said Charles Ireland, the brewer’s managing director, referring to the country’s largest non-Muslim communities.
‘‘There’s an ingrained mutual respect in Malaysia which, as an expat in the country, I find extraordinarily heartening.’’ Despite such cultural challenges — and the fact that Malaysia has one of the world’s highest excise taxes on alcohol —beer consumption here has remained relatively steady in the last decade.
Analysts and local manufacturers are cautiously optimistic that sales may gradually increase as the economy improves, disposable incomes rise and the population of 28 million people grows.
Euromonitor International, an independent market research group, has forecast that beer consumption inMalaysia will increase to 144 million liters, or 38 million gallons, this year and 171 million liters in 2014 from 137 million liters in 2008, or five liters per person. That is small compared with Thailand, which has 65 million people, a small Muslim population and beer sales of about 2 billion liters in 2008, or 31.6 liters per person.
But in total consumption, Malaysia is slowly catching up to Indonesia, home to the world’s largest Muslim population, with 240 million people, which consumed 215 million liters of beer in 2008.
While alcohol is banned in some Muslim-majority countries, in Malaysia it is legal for non-Muslims and available in supermarkets, bars and restaurants.
Still, it remains a sensitive topic.
In July, a Muslim model was sentenced to be caned after she was caught drinking beer in a hotel in the eastern state of Pahang. In most states,Muslims found drinking alcohol can be fined up to 3,000 ringgit, or about $885; jailed for up to two years; or both. Muslims caught selling alcohol can be fined up to 5,000 ringgit and jailed for three years.
Only a few dozen cases come before the courts each year, and offenders are usually fined.
The managing director of Carlsberg Malaysia, Soren Holm Jensen, said brewers had to adapt their marketing strategies because they could only advertise in print and cinemas, and can only target non-Muslims. Carlsberg, which holds the second largest market share, ahead of Napex Corp., uses more product-related advertising in Malaysia, while in other countries it is more likely to depict people drinking in a social setting, Mr. Jensen said.
‘‘We have to acknowledge that we are only selling to 35 to 40 per cent of the market, so it’s very important in all aspects of what we do,’’ he said, referring to marketing to specific communities.
‘‘You need to be sure that your messages are not offensive.’’ Malaysia, a middle-income country, aims to qualify for developed nation status by 2020. The World Bank has forecast that the Malaysian gross domestic productwould grow4.1 percent next year after contracting 2.3 percent this year.
With renewed economic growth, the only inhibitor to increasing beer sales, some analysts say, could be further excise tax increases.
Mr. Jensen said the tax amounted to 7.40 ringgit per liter, givingMalaysia the second highest alcohol tax in the world after Norway.
A 325-milliliter, or 11-ounce, can of Carlsberg typically sells for 5 ringgit at a supermarket. The price in high-end hotels is about 20 ringgit for a bottle.
‘‘By any measure, Malaysia comes out as one of the most expensive places in the world for a beer,’’ Mr. Jensen said.
‘‘Wefind it reasonable to have high duty levels due to the religious and ethnic factors, but it’s reached the level where it’s become borderline inaccessible to the common, legal beer drinkers.’’ Mohamed Sufian, deputy director of the excise unit at the Malaysian Customs Department, said the government believed the tax was at a ‘‘manageable’’ level and was accepted by consumers.
In a report this year, Euromonitor attributed a rise inMalaysia’s alcohol sales in 2008 to the government’s decision not to raise the tax on beer, coupled with the rising affluence of consumers and an increasing number of female drinkers.
Guinness Anchor recently reported its best fiscal-year performance since the company was formed 45 years ago, posting revenue of 1.29 billion ringgit and a pretax profit of 191.2 million ringgit for the financial year ended in June.
Other businesses see opportunity amid the challenges in the multiethnic Malaysian society.
Pork is also off-limits to Muslims, and is not found on many restaurant menus, so Werner Kuhn opened El Cerdo, a restaurant in a popular dining area in Kuala Lumpur, in 2005. The name translates as ‘‘the pig’’ in Spanish.
‘‘You have to give your customers a reason to come to your place,’’ said Mr.
Kuhn, a German chef. ‘‘You have to offer something no one else does.’’
