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. Last Updated: 07/27/2016

Coke's Cool But Czech Beer's Best

PRAGUE -- Coca-Cola and its arch-rival Pepsi-Cola, both waging campaigns to conquer eastern Europe, are running into a common enemy in the Czech Republic -- beer.

With a per capita consumption of around 150 liters a year, the Czechs claim the title of the world's beer-drinking champions. Their country is one of the few where beer costs less than many soft drinks. The most celebrated Czech brands are considered part of the national heritage.

Czech pride in the national beverage runs deep. "Wherever beer is brewed, all is well. Whenever beer is drunk, life is good," translates a popular rhyme that dates back centuries.

In working class districts of Prague, many pubs open at 8 a.m., allowing clients to down a quick one before they start work.

At least one establishment in the district of Smichov, home to the country's biggest brewery, begins filling glasses at 6 a.m.

Such habits are formidable obstacles on the road to market domination for the Coca-Cola Company and PepsiCo Inc., the two soft drink giants that have been sinking millions of dollars into east European expansion programs.

In January PepsiCo announced plans to invest $115 million in the Czech Republic and Slovakia, its former partner in the Czechoslovak federation. PepsiCo officials said the company was determined to become eastern Europe's beverage leader by the turn of the century.

Eleven months earlier, Coca-Cola opened a $28 million bottling plant in Prague which company chairman Roberto Goizueta said was part of plans to take more than half the soft drinks market outside the United States by 1995.

Cola consumption has increased by leaps and bounds in most of eastern Europe since the end of Communist rule, when Coca-Cola and its rival were often branded as symbols of the capitalist enemy.

But as far as the Czech Republic is concerned, the rival colas have a long way to go to dent the predominance of beer.

"We try and make people change their habits," said Geoff Mensforth, general manager in Prague of Coca-Cola Amatil Ltd., the Australian-based company which bottles and distributes Coca- Cola in the Czech Republic. "But it's a long-term process."

According to a recent survey, Coca-Cola holds about 20 percent of the soft drinks market, Pepsi roughly 5 percent. Czechs drink three times as much beer as all soft drinks combined.

"For us, beer is liquid bread," said Jan Kaspar, a 45-year-old mechanic, downing a mug of thick dark beer at a Prague bar. "It's much more than a refreshment. It's a way of life."

So much so that apart from a string of beer festivals, the Czechs even have an annual speed drinking contest whose 1993 winner downed a liter of beer in 4.89 seconds.

So much so that the authorities keep a close eye on who runs major breweries.

When the government approved a merger between the makers of the international Pilsner Urquell brand and the smaller Prazdroj brewery in January, it retained a "golden share" with which it can veto decisions it might deem harmful to the product.

Urquell, the best-known Czech beer, is made in Plzen, a Bohemian city where beer has been brewed since 1295. But the brew that spawned thousands of usually paler imitations under the generic name Pilsner, or lager, dates back to 1842.Efforts at centralization under the former communist government narrowed the variety of beer but there are still 72 breweries, producing beer that ranges from light pale to pitch black.

Earlier this year, a Czech newspaper noted that per head consumption in 1993 had dropped by 13 liters compared with the previous year and argued that this was a sign of changing drinking habits.

Not at all, says the Association of Small Independent breweries. There are fluctuations from year to year but the average over the past decade has remained stable at 153.6 liters.

To make sure it does, many breweries are spending more on advertising and promotions. Some connoisseurs see beer wars on the horizon, with prices dropping to keep drinkers straying to other beverages.

Even by the low-wage standards of the Czech Republic -- the average monthly industrial wage is 6,665 crowns ($222) -- beer prices are low.

Depending on the pub, half a liter (one pint) of draft beer can cost as little as eight crowns (26 cents), less than almost anywhere else in the world. A cola drink tends to cost almost twice as much.