British American Tobacco Malaysia managing director Jack Bowles expects legal cigarette sales volume in 2009 to be affected by the large tax-led prices and the economic downturn.

In an interview with The Star, Bowles said that the overall industry volumes for the first three quarters of 2008 declined by 2.2 per cent versus the same period last year.
“As a result of the significant excise hike this year (2008), legal volumes will continue to be pressured as the industry continues to take large tax-led price increases which inevitably fuel the growth of illegal cigarettes,” he said.
“With the current global economic downturn, we foresee that consumers will become more cautious in their spending. Consumers who choose to continue to smoke may downtrade and resolve to buying cheaper alternatives such as illicit cigarettes. Hence, the demand for cheaper, illegal cigarettes will exacerbate the already high illicit trade volume of 24.9 per cent,” he added. (pi)