PMI, Spanish tobacco renew relationship

Philip Morris International is strengthening its long-term commitment to the future of tobacco growing in Spain by renewing its Framework Collaboration Agreement with the Spanish Ministry for Agriculture, Food and the Environment for the next three years, the company said last week.

“As part of the new Agreement signed today in Madrid and subject to the agreed terms, PMI will buy 33 percent more of the Spanish tobacco crop in 2013 compared to 2012,” the company said in a note posted on its website yesterday. “In 2014 and 2015 PMI will increase its tobacco purchases by an annual rate of approximately 5 percent.”

The new agreement was signed by Spain’s Minister for Agriculture, Food and the Environment Miguel Arias Cañete, and Spaniard Drago Azinovic Gamo, president of PMI’s EU region.

“We are pleased with this agreement, which reaffirms the support of the Spanish government, the regional government of Extremadura and PMI for the continued, sustainable growth of quality tobacco leaf in Spain,” said Drago Azinovic.

“Despite the increasingly competitive and continually changing business environment, PMI remains committed to the future of this sector and the jobs it creates in Spain.

“It is for this reason that, along with the entire tobacco sector, we are especially concerned about the impact the extreme proposals in the proposed European Tobacco Products Directive currently being debated in Brussels.

“This directive could very negatively affect the entire sector that in our country generates 56,000 jobs and approximately 6 percent of the Spanish government’s total tax revenue.”

The agreement is said to reaffirm the commitment that PMI, the government of Extremadura and the Spanish Ministry for Agriculture and Environment have made to focus on efforts to improve the quality of Spanish tobacco and make it more competitive, “particularly against the backdrop of an increasingly challenging economic and regulatory environment.”

“It also includes provisions that will enhance the environmental sustainability of tobacco growing areas by encouraging good agricultural practices,” the note said. “To assist in putting these practices into place, PMI will offer tobacco growers’ associations and others involved in the growing and processing of tobacco, training sessions on good agricultural practices over the next three years.”