Lower price of cigarettes in Azerbaijan
February 10, 2016 19:21 (UTC + 04: 00)
By Amina Nazarli
The retail prices of several brands of cigarettes have been drastically reduced in Azerbaijan, and market sources have confirmed the information.
Ali Verdiyev, director of commercial affairs and communications at Japan Tobacco International (JTI) Azerbaijan, said the main reason for the drop in cigarette prices was the fight against contraband tobacco products in the local market.
Following the increase in prices, tobacco products illegally imported into the country appeared on the Azerbaijani market, he told Trend.
âThese products cost less. Therefore, despite their poor quality, people sought to buy them. We therefore decided to reduce the price of cigarettes to prevent the spread of contraband products, âhe explained.
The decision also takes into account a decline in the purchasing power of the population.
The price drop covers the Winston and Kent brands, which are the best-selling brands in the market. Winston’s price has dropped 12-15% and now costs 2.8 manat ($ 1.7). The price of Kent has fallen 14-25%, from 3.5 to 4 manat ($ 2.2 to $ 2.5) to 3 manat ($ 1.8).
Rufat Guliyev, president of European Tobacco Baku, in turn believes that the process of lowering prices may also cover other brands of tobacco, tying it to lower demand.
âSince these cigarettes were quite expensive, the demand for them went down, so the price went down. This process can continue if the demand for expensive cigarettes continues to decline. It is the law of the market economy. Reducing demand means reducing the proposition. This applies not only to cigarettes, but to any other product. Azerbaijan has a liberal economy, so sellers are forced to lower prices due to lower demand, âhe told Trend.
Local tobacco production covers up to 20-25 percent of demand. The increase in tobacco production depends on several factors such as agreements with multinational cigarette manufacturing companies, market demands and raw material prices.
The country is quite capable of securing itself by increasing its own production to 90 percent, but experts say there is a need to equip agriculture with skilled workers.
Most smokers 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 a day.
The country is taking several measures to prevent smoking outdoors, by introducing a ban and sanction for smoking in public spaces.
Amina Nazarli is the journalist for AzerNews, follow her on Twitter: @amina_nazarli
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