Tobacco Production to Grow Five Fold

YEREVAN (Noyan Tapan)–Armenian tobacco-processing enterprises will conclude agreemen’s with farms on planting tobacco on 1.4 thousand hectares of farmland. These areas are expected to yield five thousand tons of tobacco–which is four times as much as last year–the co-owner of the "Grand Tobacco" and "Armtobacco" enterprises–Hrant Vardanian told reporters. In 1996-97 the tobacco-growing farms grew 150-200 tons of tobacco–and in 1998 over one thousand tons. Traditionally–15 thousand tons of tobacco were grown in Armenia annually.

The home tobacco-producers consume up to five thousand tons of tobacco. Vardanian pointed out that under the preliminary agreement an Armenian-Greek export-oriented tobacco-processing joint venture will be established within the next two months. According to Vardanian–even Russian cigarette-producers are ready to purchase 10 thousand tons of Armenian tobacco.

Vardanian also pointed out that besides the traditional markets in the former Soviet republics–Armenian tobacco products exported to the USA and Canada. He reported that in the near future the cigarettes "GT" will also be exported to Germany.

This year Armenian tobacco-processing enterprises are planning to bring the volume of production up to five billion cigarettes a year. Thus–home-made products will win 80 to 90 percent of the domestic market–Vardanian said.

According to the statistical data–in 1998 the production of cigarettes in Armenia increased threefold and made up 2.426 billion cigarettes: "Grand Tobacco" produced 2.165 billion cigarettes–and "Armtobacco," 261 million cigarettes. The two enterprises paid $6.2 million in taxes.

In 1998–the imports of cigarettes on which state tax and duties were imposed added up to 3.122 billion cigarettes. 5.548 billion cigarettes were delivered to the local market–which–Vardanian said–testifies that almost all channels of smuggling cigarettes have been eradicated–as about 5.5 billion cigarettes are smoked in Armenia annually. Vardanian reported that in 1995-98 2-5 billion cigarettes were smuggled into Armenia. Vardanian expressed his intention to present the government with detailed information about firms engaged in delivering cigarettes to Armenia illegally.

According to Vardanian–the government’s 1998 decision on mandatory inscriptions in Armenian on the cigarette-pack is another step aimed at protecting the home market from smugglers. Besides–the government’s decision on raising the rate of fixed paymen’s for cigarettes will also contribute the protection of the home market.

This year–the authorized capital of the "Grand Tobacco" Armenian-Canadian joint venture is expected to reach the level of $1,000,000. As for the "Armtobacco" enterprise–its 296-million-dram debt was recently paid off. Vardanian also pointed out that not all of the shareholders render their assistance in covering the debts.

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