The share of the illicit segment in Moldova's tobacco market is nearly three times smaller than in Ukraine; this is a perfect example of how the illicit trade in this market can be combated and defeated, according to CEO of Philip Morris Ukraine Artem Konik.
"Take Moldova, for example. I worked there 10-12 years ago. It is a country that suffered from the illegal market for a long time, particularly due to the Transnistria factor… It used to seem to me that achieving such a result was simply impossible. But today it is a reality," he said, describing the change in the situation in the neighboring country during a speech at the "Welfare of the Nation" forum organized by NV on June 10 in Kyiv.
Konik said that when he worked in Moldova, it seemed to him that Ukraine was an example of how to combat this market, but later Moldova not only passed the necessary laws but also demonstrated the political will to enforce them.
Returning to the main topic of discussion at the forum-how Ukraine can raise the average salary to EUR 1,500 per month within five years-the CEO of Philip Morris Ukraine said the average salary in Moldova already exceeds that of Ukraine: about EUR 850 versus approximately EUR 650 in Ukraine, and the situation in the tobacco market may partly explain this difference.
Konik, citing a study by Kantar Ukraine, noted that Ukraine's budget currently loses up to $1 billion annually due to the illegal sale of cigarettes and vapes: UAH 28 billion in the cigarette market and another UAH 10 billion in the vape market, as approximately 90% of vapes sold in Ukraine are illegal products.
"Nine out of ten shopping centers in Kyiv have stores selling illegal vapes. Raids are conducted there, but they also (re)open. And if we, as a country, tolerate this, we will not move forward," the CEO of Philip Morris Ukraine said, noting that about 70% of such establishments resume operations within a week of being shut down.
Konik welcomed the recent actions by the Economic Security Bureau in the market, which may indicate an intensified fight against the black market, specifically the closure of a large illegal factory in Chernivtsi and a large-scale operation against the illegal circulation of vapes.
"We certainly support this. It's a positive development for the country. But these shouldn't be one-off actions. This kind of work needs to be done every day so that the state receives its taxes and the rules are enforced," the head of Philip Morris Ukraine said.
