GLOBAL TOBACCO INDUSTRY

Global Tobacco Industry

Table of Contents

1.Overview3

2.Executive Summary3

2.1 Industry Overview3

2.2 Top Ten Global Cigarette and Cigar Manufacturers5

i.Philip Morris USA Inc.5

ii.China National Tobacco Corporation6

iii.Reynolds American6

iv.British American Tobacco (BAT)7

v.Japan Tobacco International7

vi.Imperial Tobacco Group PLC8

vii.Altria Group, Inc. (MO)8

viii.Universal Corporation9

ix.Vector Group Limited9

x.Star Scientific, Incorporation10

2.3 Other global key players10

3. Theories, Concepts and Key Issues12

3.1 The Role of WTO within the global tobacco industry sector12

3.2 The Role of the IMF within the tobacco industry13

3.3 Impact of Emerging Markets within the tobacco industry14

3.4 Ethical and Corporate Social Responsibility Issues15

4. Conclusion16

References19

Global Tobacco Industry

1.Overview

The tobacco industry is one of the fastest growing industries in today's world. Although, the side-effects of consuming tobacco are widely known are everyone is aware of the negative impact that it has on the health of the people, the demand for this product never reduces. The global demand for this product is on the rise which is not a good sign at all. People are losing their health due to the fact that they are consuming this product frequently. Keeping the side-effects apart, this report will analyse the global tobacco industry and the impact of globalization and other policies, such as policies of WTO and IMF.

This report will highlight many aspects of the global tobacco industry which will help in analysing the industry in a more comprehensive manner. The top ten companies of this industry will be under focus in this report and the impact of globalisation on these companies. The impact of IMF and WTO will also be discussed in this paper. As discussed above, the side-effects of consuming tobacco are negative which is why ethical considerations will also be presented in this paper with respect to this industry.

2.Executive Summary

2.1 Industry Overview

The tobacco industry is earning huge amount of revenues which is evident from the statistics. The industry has earned total revenues of $720.8 billion in 2010 which represents a compound annual growth rate (CAGR) of 3.8 percent for the period of four years i.e. 2006-2010. The major contribution in this total revenue was of the sales of the cigarettes that provided revenues of $681.1 billion out of the total revenue that the company has earned. The market share of cigarettes is equal to the 94.5 percent of the overall value of the market.

The global tobacco industry grew at a steady rate during the years 2006-2010. The main factor for the steady growth was that the sale of cigarettes was steady, as well. As soon as the sale and the demand for cigarettes went up, the industry started to grow. During the past few years, the consumption of tobacco has increased a lot and this consumption has especially increased in the teenagers. More and more teenagers are getting involved in this and are consuming tobacco which is why the consumption of this product has increased (360.datamonitor.com).

The forecast for this industry for the coming years is even big. The industry will earn huge revenues in the future. According to a forecast, it is estimated that the CAGR will reach ...