Vietnam Smokes 4.17 Billion Packs of Cigarettes A Year

Source from:  Tuoitrenews 12/05/2013

Vietnam consumed a total of 4.174 billion packs of cigarettes in 2012, the Vietnam Tobacco Association reported Tuesday.

The shocking figure was released at a conference intended to implement a national program to combat smuggled and contraband cigarettes in Hanoi.

Vietnam's cigarette consumption has been on the rise since 2010. Cigarette consumption recorded in 2010 and 2011 was 3.986 billion packs and 4.131 billion packs respectively.

In the first eight months of this year, tobacco consumption reached 2.760 billion packs, the association said.

Smuggled cigarettes are another headache for authorities, the association added.

Last year some 900 million cigarette packs were illicitly brought to Vietnam, accounting for 21.6 percent of the domestic cigarette consumption of 2012.

JET and HERO brands account for 90 percent of the smuggled products. Since 2012 they were joined by ESSE, complicating the domestic market further.

The smuggled products caused huge financial damage to the country.

With some 800 million cigarette packs smuggled on an annual basis, the state budget loses up to VND4.2 trillion worth of taxes.

The illicit products also cost the tobacco growing areas 17,000 tons of materials and 39,000 jobs of local growers, who also lose some VND170 billion of earnings per year.

Vietnamese cigarette makers also lose up to VND250 billion of profits due to the smuggled products every year.

Vu Van Cuong, chairman of Vinataba, the state-run cigarette maker, said the problem is not because local products are of lower quality than the illicit counterparts.

It is because of the exorbitant special consumption tax of 65 percent, plus other high taxes, which makes domestic products less competitive as they bear higher prices.

Forces to fight against smuggled products are funded VND3-9 billion a year, but not so many cases have been detected.

The seized and destroyed products only account for 1 percent of the real amount of cigarettes illegally brought to the country, according to the tobacco association.

This is because demand for smuggled cigarettes remains high, while authorities do not have the means to curb the sophisticated tricks of the smugglers.

Last year global market research company Euromonitor International also reported that Vietnam is the top beer-drinking nation in the Southeast Asian region, followed by Thailand and the Philippines.

Vietnamese drinkers put down 2.6 billion liters of beer in 2011,  according to the report.

In 2010, the Euromonitor International forecast that beer consumption (by volume) in the Vietnamese market would grow rapidly.

Vietnamese consumed 1.6 billion liters of beer in 2009, a surge of 56 percent over 2004. Enditem