Costly ‘smoke’ hits many in PoM

Business, Normal

The National, Wednesday 4th January 2012

SMOKERS have been hard-hit by the sudden increase in the prices of tobacco products.
Street vendors used to buy packets of red and green Pall Mall and Spear packets and peddled them for 70 toea and 80 toea a stick, respectively.
Prices had shot through the roof over the last two weeks.
In Port Moresby, Pall Mall red cigarettes were selling for up to K1.50 each while a stick of Spear was selling between K2 in some areas and K5 in others.
Spear cigarettes were hardly available in shops in Port Moresby and some sellers had secured supplies from Madang and Wewak.
Manufacturer British American Tobacco, which is based in Madang, could not be reached for comment yesterday.
One possible explanation was that the BAT had stopped production to do re-branding due to an influx of counterfeit “Palm Mall” brands from Asia.
Although it could not be confirmed, it was exactly what happened when BAT pulled out their Benson and Hedges and Cool brands about 10 years ago due to stiff competition from contraband products.
A full packet of Pall Mall red/green, which used to sell for K10.50 on the street was now selling for K20 per packet
A lot of city street vendors earned their living by selling betel nuts and cigarettes.
A couple from Enga province residing in Port Moresby said selling of cigarettes and betel nut had been their main source of income and they were greatly affected by the increased prices of tobacco products.
Gabriel Wangu and his wife, who sold cigarettes and betel nut along Waigani Drive, said they could not do much but reduce the number of packets of cigarettes they sold each day.
“The only reason why we continue to sell is for us to buy food for our children,” he said.
Wangu said they could not afford to sell Spear because the price of one box had jumped to K160.
Yesterday, the couple was selling Pall Mall cigarettes for K1 per stick, while other vendors sold Pall Mall red for K1.50 and green for K1.
Wangu said there was no constant price for cigarette as it varied at different places.
He said during the festive season, they paid K20 to K25 for a packet of Pall Mall red and K16 to K18 for Pall Mall green, thus increasing the price per stick to K1.50 and K1.
Wangu said he did not know why cigarette prices had increased.
A smoker, Xavier Maigil, said smokers had been cheated by high prices, which were not the actual representation of the 15% excise duty imposed by the government in the 2012 National Budget that took effect on Sundayt.
High cigarette prices took effect about three weeks before the New Year.
A Spear smoker, Maigil said, he was dropping his brand and would rather smoke either the red or green Pall Mall.
Another smoker, Ritchie Vere, said he was a “great Spear smoker” but had not been smoking it for the past few days because it had become costly.
He said he was consi­dering quitting cigarette.
The increased cigarette price was the result of the 15% tobacco and alcohol excise rates that were passed during the K10.5 billion budget last month.
Attempts to get comments from BAT in Port Moresby were unsuccessful because most of the senior staff were still on holidays.