Cigarette price declines in Azerbaijan
By Amina Nazarli
Retail prices of several cigarette brands have been significantly reduced in Azerbaijan and market sources confirmed the information.
Ali Verdiyev, a corporate affairs and communications manager at Japan Tobacco International (JTI) Azerbaijan, said that the main reason for the decline in the cigarette prices is to combat the smuggled tobacco products on the local market.
Following the prices increase, the tobacco products being illegally imported into the country appeared on the Azerbaijani market, he told Trend.
"These products cost less. Therefore, despite their poor quality, people sought to buy them. So, we decided to reduce the cigarette prices to prevent the spread of smuggled products,” he explained.
The decision also takes into account a decrease in the purchasing power of the population.
The price cut covers Winston and Kent brands, which are the most selling in the market. The price for Winston fell by 12-15 percent and now they cost 2.8 manat s($1.7). The price for Kent dropped by 14-25 percent from 3.5-4 manats ($2.2-$2.5) to 3 manats ($1.8).
Rufat Guliyev, the chairman of the European Tobacco Baku, in turn, believes that the process of price decrease may also cover other tobacco brands, linking it with the lower demand.
“As these cigarettes were quite expensive, the demand for them has decreased, so the price fell. This process can continue, if the demand on expensive cigarettes will further fall. This is the law of the market economy. Reduction in the demand means reduction of proposal. This applies not only to cigarettes, but any other product. Azerbaijan has a liberal economy, so sellers forced to cut price due to lower demand,” he told Trend.
Local production of tobacco covers up to 20-25 percent of the demand. Increase of tobacco production depends on several factors such as agreements with multinational cigarette manufacturing companies, market demands and prices of raw materials
The country is quite able to ensure itself by 90 percent expanding its own production, but experts say it is necessary to provide agriculture with qualified personnel.
Most of the smoking population in Azerbaijan are men. About 50 percent of men in the country smoke daily, 40 percent of them smoke at least one or two packs of 20 cigarettes per day.
The country conducts several measures to prevent outdoor smoking, by introducing ban and penalty on smoking in public areas.
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Amina Nazarli is AzerNews’ staff journalist, follow her on
Twitter: @amina_nazarli
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