12.Oct .2020 11:30

Cigarette Import to Georgia Declined by 35%

Cigarette Import to Georgia Declined by 35%
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Georgia has imported 3,005,567.4 thousand cigarettes, worth USD 43,323 400 during Jan-Aug 2020. The number was 4,606,505.5 thousand, worth USD 58,676, 800 during the same period of the previous year. The YoY comparison has shown over 35% reduction of import.

According to National Statistics Office of Georgia, with 2,189,681,000 imported cigarettes Ukraine is the leading exporter of cigarettes to Georgia during 2020. It is followed by Armenia - 321,940, 000, Uzbekistan - 104,500,000, Russia - 62,910,200 and Serbia - 53,500, 000.

Total number of import stood at 7,481,254, 100 cigarettes, worth USD 104, 716, 800 during 2019. The main importers of cigarettes to Georgia during the current year were: Ltd Elizi Group, BAT Georgia Limited Representative Office in Tbilisi, Georgia, LLC Philip Morris Georgia, JTI Caucasus and LLC International Marketing & Trading (Note: importers are not sorted by rating).

Georgian tobacco market has been impacted much by COVID-19. During the lockdown, all non-essential retailers were forced to close to prevent the spread of COVID-19. However, the cigarette sales reduction cannot be linked only to the global pandemic. Overall tobacco sales continued to decline in 2019 pre COVID-19.

Pursuant to Euromonitor International report of Aug 2020, “tobacco recorded the sharpest current value decline in 2019. Cigarettes, by far the largest category in tobacco, again recorded steep retail volume declines as the price hikes led to consumers seeking cheaper alternatives and increased illicit sales of cigarettes, damaging legal volume sales”.

“The increase of taxation on non-filter cigarettes forced local producers to raise their prices. As most non- filtered cigarettes were locally produced this caused a shrink in manufacture and those cigarettes classed as unfiltered but sold alongside filters were no longer in demand,” the Report states.

A continued shift away from cigarettes is expected by the authors of the report over the forecast period. “This will be largely due to economic reasons as taxation continues to increase”.