New Carreras boss wants to consolidate gains made in the new business environment

Business

New Carreras boss wants to consolidate gains made in the new business environment

BY DURRANT PATE
Observer Business writer

Sunday, February 16, 2020

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Newly appointed managing director of cigarette company Carreras, Raoul Glynn is promising to consolidate the gains made in tackling the company's three primary imperatives in the new cigarette business environment in Jamaica.

These are combating the illicit cigarette trade, high taxation on cigarettes and tobacco products, and the soon-to-be-introduced new government regulations. These regulations are intended to further reduce demand for smoking, including the full implementation of a comprehensive ban on tobacco advertising, promotion, and sponsorship.

In complimenting his predecessor, Marcus Steele, who demitted office on February 1, for the gains made in these three areas, Glynn, a Trinidadian national, called for a more strategic partnership to address these three company imperatives.

Questioned about his strategy in moving forward in these three areas of concern, the new Carreras boss explained, “Carreras can't do it on our own, so we need the authorities to be involved in the process.”

Referring to the impending regulations, Glynn encouraged that the regulations be fair, promising that Carreras will work with the Government in crafting a regulatory regime which is best for all. Such a regime, he stated, Carreras would have no problem with, emphasising fairness as the key imperative.

He gave Carreras' commitment to work tirelessly, on focusing on its side of the partnership with the Government by “ensuring that the business is sustainable, providing employment, providing opportunities for young people…it's a holistic approach”.

In this new partnership approach in addressing Carreras' concerns with the business environment, Glynn expounded that advocacy would be a vital tool in making out a case for changes in the business environment.

Glynn, who took up office on February 1, was recruited from his post as country manager for Carisma Marketing Services, which is an affiliate of Carreras. Carisma, which is based in Trinidad, is a subsidiary of British American Tobacco (BAT), with responsibility for BAT's operations across the English, French and Dutch Caribbean.

Last year Carreras reported that the illicit trade in cigarettes is growing much faster than initially thought, with internal studies showing that almost one third of all cigarettes in Jamaica are illicit. According to Carreras, Jamaica's sole licenced distributor of cigarettes, “the incidence of the illicit trade in cigarettes remains a major concern…the illicit trade in cigarettes forms a part of the informal segment of the Jamaican economy, which is estimated to be between 40 per cent - 60 per cent of the formal economy.”

At its annual general meeting last year, Carreras reported that it has still not fully recovered from the 2015-2017 increase in excise duty on cigarettes. The recovery has slowed, which resulted in the company posting after-tax profits for its 2019 financial year of $3.4 billion, representing a decline of 2.2%.

The Special Consumption Tax was increased on cigarettes in March 2017 by 21.4%. This was preceded by a 16.7% increase in May 2016 and a 14.3% increase in March 2015.


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