With Azerbaijan aiming to minimize the import of tobacco products, the tobacco manufacturer, Tabaterra, is to build a tobacco factory in the Sumgayit Chemical Industrial Park, about 30 km from the capital, Baku, according to an AzerNews story.
The factory is expected to have a capacity such that it will be able to meet the country’s total demand for tobacco products.
Meanwhile, Azertutun Ltd, part of the Azerbaijan Industrial Corporation (AIC), has estimated its 2018 production of leaf tobacco at 3,000 tons.
AIC director general Kamran Nabizade was quoted as saying that Azerbaijan had planned to produce 6,000 tons of tobacco this year, of which 3,000 tons would be accounted for by Azertutun.
The AzerNews story said that Azerbaijan was aiming to realise the potential of the leaf tobacco industry by increasing its competitiveness.
Azerbaijani President Ilham Aliyev signed a decree approving the State Program for the Development of Tobacco Growing in Azerbaijan for 2017-2021 on August 10, 2017.
According to the order, the State Program is aimed at developing tobacco production and processing, increasing profitability and export potential, and increasing employment in rural areas.
The state program is said to take account of all the factors necessary for the development of the industry.
Tag: Azerbaijan
New factory for Azerbaijan
Turning over a new leaf
Azerbaijan is increasing tobacco production as part of a plan to expand its economic base and lessen its dependence on oil, according to an AzerNews story.
Namig Shalbuzov, an expert at the Center for Economic Reforms Analysis and Communication, said that tobacco production had been increased considerably in recent times.
He told AzerNews that while about 3,600 tons of tobacco had been produced in the country during 2016, this figure had increased by more than 44 percent to 5,200 tons last year.
The main reason for the increase, he said, had been down to the attention shown to the tobacco industry by the country’s leadership.
For instance, the purchasing price of tobacco had been increased significantly. In 2015, the price of ‘first class wet tobacco’ had been 0.16 manats ($0.90) per kg, and the price of ‘second class wet tobacco’ had been 0.08 manats per kg, while in 2016 these prices had risen to 0.25 manats and 0.15 manats per kg.
Shalbuzov said that last year, subsidies were given to tobacco producers and that support measures were expected to continue in the coming years.
In 2015, unmanufactured-tobacco exports from Azerbaijan were said to have been worth $7.4 million, while in 2016 they were worth $8 million.
Over the same period, however, the value of cigarette exports dropped from $2 million to $0.9 million.
But Shalbuzov said that Azerbaijan had a great opportunity to produce more cigarettes from local tobacco and boost exports.Import limit proposed
Azerbaijan’s State Customs Committee is making a number of proposals aimed at strengthening the fight against the illegal import and sale of cigarettes, according to a Trend News Agency story quoting the chairman of the State Customs Committee Aydin Aliyev.
However, the only proposal described in the story relates to restricting legal imports rather than clamping down on illegal activities.
Aliyev said the proposals envisaged restricting the quantity of cigarettes that citizens could import for their personal use to one carton of cigarettes once a month.
Current rules are said to allow the import of three cartons per person.
Speaking at a press conference in Baku on January 19, Aliyev said the new proposals would be discussed during the spring session of parliament.Azerbaijan to up production
Tabaterra CJSC, which started up in Azerbaijan on September 11, is expected to produce seven billion cigarettes a year, according to an AzerNews story.
Tabaterra’s plant, on the Sumgayit Chemical Industrial Park (SCIP), is slated to employ 200 people and to manufacture three types of tobacco products.
AzerNews reported that 1.6 billion of the 10 billion cigarettes consumed each year in Azerbaijan by the 47 percent of the population that smokes were manufactured in the country, and that the bill for importing the rest was US$150 million annually.
Given this situation, Azerbaijan had decided to increase tobacco production.
The government was aiming to increase the area dedicated to growing leaf tobacco from 3,200 ha to 6,000 ha, and to increase cigarette production by raising the capacity of existing cigarette factories and establishing new ones.
These initiatives were expected to increase Azerbaijan’s cigarette production capacity from 16-17 percent of domestic consumption to 70 percent.
The SCIP was established by presidential decree in December 2011 with the aim of accelerating economic development in Azerbaijan and increasing its competitiveness with other countries.
Companies operating from within the SCIP are exempted from property, land, and corporate income taxes, and from VAT on imported equipment.
Growing plans in Azerbaijan
Under government plans, Azerbaijan is aiming to increase the amount of land under tobacco from 3,200 ha to 6,000 ha, according to an AzerNews story relayed by the TMA.
Azerbaijan produces 1.6 billion cigarettes a year but consumes more than 10 billion, which means that it spends about US$150 million a year on imports.
Economist Dr. Rufat Guliyev indicated the time was right to increase production.
For one thing, new varieties had been introduced during the past 15 years.
For another, the current level of tobacco control in Europe meant it was practically impossible to plant tobacco there.
In addition, the world had almost ceased offering subsidies in the sphere of tobacco growing.
Azerbaijan harvested 3,700 tons of tobacco during January-September, up 19.3 percent on that of the corresponding period of last year, according to the State Statistics Committee.
Also in January-September, the country produced tobacco products worth 27.48 million manat (US$16.2 million), down 12.8 percent on the value of products produced during the first nine months of 2016.
Tobacco association formed
The Association of Tobacco Producers & Exporters has been established to help Azerbaijan increase the production and export of tobacco and tobacco products, according to an Azerbaijan Business Center story.
The ministry of economic affairs was said to have reported that the association was founded on the initiative of producers and exporters of tobacco with the support of the National Confederation of Entrepreneurs.
The constituent meeting of shareholders was conducted in Zagatala on October 6, the ministry said.
During the meeting, members of the association’s board and audit commission were elected, and Telman Hasretov was elected chairman of the board.
The association is expected to help co-ordinate the activities of the producers and exporters of tobacco products, expand co-operation among them, accelerate development of the sector and provide for increasing production and export of tobacco and tobacco products.
Anti-tobacco bill passed
The Azerbaijani parliament has passed a bill restricting tobacco use, according to a story on News.az quoting AzVision.
Few details of the bill were given, though the story said that it comprised three chapters and 17 articles setting out a number of anti-tobacco measures, including a list of those places where tobacco smoking was to be banned.
The bill was discussed at the plenary session of Azerbaijan’s Milli Majlis (parliament), put to the vote and adopted at its first reading.
The chairman of the parliament’s Labor and Social Policy Committee Hadi Rajabli was said to have provided information on the bill, which he described as being in line with ‘social demands’.
He told parliament that 67.5 percent of men and 52.5 percent of women suffered from tobacco dependence.
“It is intolerable that this all leads to drug addiction, which causes discontent in society” he said.
“I am glad that the draft law has also been discussed in the press and the society appreciated it,” he added.
However, the mood wasn’t totally anti-tobacco. The committee chairman noted that interest in Azerbaijani tobacco had increased abroad, and that the adoption of the new bill did not mean that less tobacco would be produced in the country.
Tobacco seeds zero rated
Azerbaijan has said that the import of tobacco seeds will be exempted from customs duties from the end of May, according to an AzerNews story.
Earlier, tobacco seeds were included in the ‘others’ category under Group 12 imports, which comprised oily seeds and fruits, other seeds, fruits and grains, hay and feed, and medicinal and technical plants.
As such, they were the subject to a three percent customs duty based on their value.
Now, following an announcement by the Azerbaijani cabinet on Monday, tobacco seeds are included in a separate subcategory with a zero rate of customs duty.
Azerbaijan bans GMO tobacco
Azerbaijan has implemented a ban on GMO tobacco, according to a story in the AzerNews. In addition to GMO tobacco, no GMO wine or cotton products can be imported to Azerbaijan or produced in the country, effective immediately.
A series of amendments to the laws “On tobacco,” “On viticulture and winemaking” and “On the cotton” have already been drafted, the parliament reported.
Changes to the “On tobacco” law ban the import of tobacco and tobacco products that were produced using genetically modified plants or agricultural plants created with methods of biotechnology and genetic engineering.
The Azerbaijan government has previously prohibited the import and distribution of GMOs as well as the use of genetically modified plants in food products.
In April, Azerbaijan decided to enforce criminal liability for the use of GMOs, and in July, the State Committee for Standardization, Metrology, and Patents reported that no GMOs were found during a routine check.
