Lyft to boost BAT revenues
Cigarette maker British American Tobacco (BAT) plans to reintroduce nicotine pouches Lyft in Kenya as the firm broadens its product portfolio.
Lyft was first introduced into the local market in late 2019 but sales were halted in October 2020 due to uncertain regulations and government concerns around the product.
According to BAT PLC, the global company has been in talks with the government to help address the regulatory issues that led to the brand’s withdrawal from shelves.
“In Kenya, we continue to engage with relevant authorities on the regulatory and fiscal framework to support commercially sustainable re-entry into the modern oral category,” the company noted.
BAT continues to face a harsh operational environment in Kenya due to tough guidelines on marketing and distribution implemented by the government and further pushed for by lobbying groups.
From its base in Kenya, BAT exports its products to Somalia,
Sudan and Egypt markets, which have less rigid legislative structures to counter the current Kenyan tobacco consumption climate.
The firm is also targeting Djibouti, Madagascar and South Sudan with cigarettes, cut rag tobacco and tobacco-free oral nicotine pouches, Lyft, analysts at AIB-Axys Africa said.
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Additionally, they are looking into the Common Market for East and Southern Africa (COMESA) for further expansion.
The company’s green leaf threshing plant in Nairobi will work to supply various markets and produce a range of products besides being a manufacturing hub for the Eastern Europe, Middle East, and Africa region.
Exports to these countries will be further boosted by the company’s investments in a new warehouse that will cater to increase product storage capacity targeted for export markets.
In the 2022/23 financial year, the Treasury seeks to adjust the excise duty on liquid nicotine to Kes70 per millimeter to discourage the uptake of e-cigarettes.
Treasury CS Ukur Yatani seeks to make the addictive product less accessible to users including school-going children and the youth.
“Nicotine addiction is growing in Kenya and the use of these products leads to nicotine addiction and consequently smoking and use of other drugs,” he said, adding “in the financing, this kind of “science,” the industry’s motive is of course financial gain, power and influence and not the health of our young ones,” Mr Yatani said while presenting Kenya’s 2022/23 spending plan.