Thai Tobacco Sets Sights on Eastern Europe

Source from:  By Achara Deboonme THE NATION August 13, 2008 08/14/2008

Thailand Tobacco Monopoly (TTM) is looking to penetrate the Eastern European market as part of its drive to boost exports in light of declining cigarette consumption at home. TTM has recently exported some cigarettes to Singapore, Taiwan, Brunei and the Middle East, the workplace of a number of Thai workers. To accommodate the overseas marketing, new brands will be launched for easy recognition. Eastern Europe, particularly Poland and Russia, has high purchasing power, while its economies are expanding and regulations are not as strict as those in Thailand. "We have a rough target for the ratio of export revenue to total revenue, but the process takes time, as trial and error is involved in the development of cigarette tastes," said Prapassorn Phongphanpisan, the agency's spokesman. "Meanwhile, as a state agency, we are governed by rules and regulations. Still, we must seek additional revenue, as this is our mission and this is a means to ensure the organisation's survival." In the domestic market, TTM has no plan to launch new brands, in line with the government's anti-smoking campaign. Like private tobacco companies, it has witnessed declining demand in the Thai market. Though value has been rising through higher prices, sales volume has dropped continually. While the law now bans smoking in public places and entertainment venues, the Cabinet recently approved an increase in the excise-tax ceiling on tobacco products, from 80 per cent of value to 99 per cent. Although the increase requires parliamentary approval, probably early next year, it would force sellers to quote higher prices, which could dampen sales. According to Prapassorn, under these conditions TTM is forced to look more to export markets. On the domestic front, as a cigarette producer, it also ensures public cooperation with the tobacco laws. It has launched a campaign to educate entertainment venues and shops on the new laws, while providing assistance in ensuring social compliance. Under the campaign, TTM will help to clarify smoking and non-smoking areas at public venues such as bus terminals. "Our message is we're ready to ensure a better environment for non-smokers. Meanwhile, non-smokers should not treat smokers as villains. If they have a smoking place of their own, they will not disturb others," she noted. Enditem