With more than 300 million smokers, China is a country with a high-burden of tobacco-use and, also, one of five focus countries for the Bloomberg Initiative to Reduce Tobacco Use. Despite its negative effects, there has been a rise in the demand for tobacco across the globe. Philip Morris has recently announced that it is shifting its focus on manufacturing ‘smoke free’ nicotine products. Source: Compiled from BAT (2013), Hongta Group (2010), STMA (2006, 2009, 2012), Tobacco-free Kids (2010). To enhance global competitiveness, Chinese product development involved three strategies: consolidation of brands into a smaller number with mass appeal; adaptation to appeal to foreign markets; and higher value-added premium products. Previous analyses of the global tobacco industry recognise the importance of, but generally exclude, the CNTC because of its strong domestic focus. Between 1998 and 2009, this consolidation reduced the number of companies to one-sixth (Figure 2). These sources were used to map the industry’s history and changes to its structure over time. Source: Compiled from BAT (2013), CTI (2014a), CTIEC (n.d.), Hongta Group (2010), MOFCOM (2015), Namibia Oriental Tobacco (n.d.), STMA (2006), STMA (2009, 2012), Tobacco-free Kids (2010), United Castle America (n.d.) and Zhejiang Tobacco Industrial (2015). Domestically, the market has neared saturation among adult males with 53% smoking prevalence rates. The company operates nearly 48 production facilities in 32 countries. Overall, restructuring of the Chinese tobacco industry since the early 2000s has been seen by industry sources as a key strategy for CNTC to become globally competitive. WHO age-standardized prevalence for daily adult smoking in China was estimated to be 22% in 2012. This policy was named the ‘Go Global’ strategy in 2000 (CCPIT, 2007). Another indicator of globalisation is product development to promote a small number of Chinese ‘heritage’ brands overseas, as well as premium brands. Political instability and conflict over decades undermined attempts to regulate the industry (STMA, 1997). The CNTC undertakes central planning, manages raw materials, sets regional production quotas for leaf and products, and is the umbrella company for provincial firms. The US-based tobacco and cigarette company, Philip Morris International sells its products in over 180 countries. The initial potential offering (IPO) will help China National Tobacco Corporation to raise about $100 million. Currently, there is no content with this tag. (2010) describe, TTCs pressed hard to access the closed Chinese market during accession negotiations. Source: Compiled from Liu and Ren (2009) and STMA (2000, 2002, 2003, 2005, 2006). Other than this, it manufactures and supplies e-cigarettes, cigars, and a range of oral tobacco and nicotine products, including tobacco-free nicotine pouches, snus and moist snuff. Methods The paper uses data on China’s monthly cigarette consumption per capita from January 2000 to June 2017 to estimate the impact of specific policies on China’s tobacco consumption. China Tobacco: State Owned Enterprise in China, Asia. For further information review our Privacy Policy. IMARC offers market research reports and consulting services to clients consisting of, but not limited to, SMEs and Fortune 500 companies. In January 1982, CNTC was officially incorporated. Tobacco companies are concerned with the sale and distribution within the province of all tobacco products regardless of where they are produced. Request Profile Update; Download Data Alongside consolidation, CNTC has pursued a strategy of premiumisation since 2008. Total number of Chinese tobacco companies (1998–2009). View more. Rather than strengthening regulations on the contents of tobacco products, STMA/CNTC has instead launched the “low tar, low harm” campaign, despite the mountain of scientific … China: Revenue in the Tobacco Products market is projected to reach US$234,628m in 2020. A ‘long-term strategic cooperative partnership’ with PMI agreed in 2005 involves licensed production and distribution of Marlboro in China, and the establishment of jointly-owned China Tobacco Philip Morris International (CTPMI) to launch and distribute Chinese brands in foreign markets. Based in Switzerland, CTPMI launched three so-called ‘heritage brands’ (RGD, Dubliss, and Harmony) in 2008, using PMI’s distribution networks in Central and Eastern Europe and Latin America (Tobacco Free Kids, 2010). This was reduced to 30 brands by 2014, with many tailored to key markets (Feng, 2014a). During the first half of the twentieth century, the industry was dominated by BAT with 82% of market share (Tong, Tao, Xue, & Hu, 2008), and a handful of domestic companies (Benedict, 2011). The limited scholarly attention to globalisation and the CNTC to date has come largely from business studies (Wang, 2009). In 2003, STG and Gallahers signed reciprocal trademark license agreements and, the following year, launched each other’s brands in China and Russia (Gallaher, 2004). It enjoys a virtual monopoly in China, which accounts for roughly 30% of the world’s total consumption of cigarettes , and is the world's largest manufacturer of tobacco products measured by revenues. China National Tobacco Corporation is the largest tobacco producer in the entire world owned by the Chinese government (Young, 2006). enhance our services. Foreign operations have been established to secure tobacco leaf from Brazil, USA and Zimbabwe. Formally separate entities, in practice the CNTC and STMA are ‘one institution with two name plates’ (STMA, 1997) governing the industry through a vertical bureaucracy (Wang, 2009). Leaf cultivation was firmly established by the mid-1800s, and smoking from the late nineteenth century with the automation of cigarette manufacturing. This increased to 44 billion sticks (two-thirds of global sales) in 2013 (Zhang & Zhang, 2013). China National Tobacco Corporation is a consumer product company based in Beijing. China tobacco imports [data file], 2016. The primary and secondary data sources were compiled into a chronological narrative according to these three questions. However, exports remained small-scale and distributed across … However, without the existence of a specialized central government agency in charge, it was impossible to … As the market has become increasingly saturated, and potential foreign competition looms, the company has turned to expansion abroad. CNTC has a market share of 44 % and sells about 99 % of its cigarettes in china. Over the past 60 years, the CNTC has been focused on supplying a huge domestic market. People also read lists articles that other readers of this article have read. While English and Chinese language sources are consulted, the available data have three limitations. Intake of tobacco can lead to several adverse health effects, which include chronic bronchitis, lung cancer, emphysema and increased risk of heart diseases. More details about this company like involved buildings and projects are recorded here. Establishing local leaf procurement companies in key tobacco growing regions of Brazil, Zimbabwe and the USA ensures a steady supply to feed growing industry needs both domestically and abroad. Market share grew, from 6% in 2007 to 25.2% in 2014, the only segment to see growth in 2014. 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