Japan Tobacco International (JTI), a prominent cigarette and vape manufacturer, has announced its intention to continue operating its factories in Russia for as long as possible. The company’s president, Masamichi Terabatake, stated in an interview with the Kyodo news agency that although JTI has the option to sell its business in Russia, they plan to sustain operations as much as they can.
The decision comes after JTI announced in April 2022 that it was considering selling off its Russian operations, JT International Russia, in response to Moscow’s military operation in Ukraine. At the time, JTI controlled nearly 40% of the Russian cigarette market and stated that they were evaluating various options for their Russia business, including a potential transfer of ownership.
However, despite the challenges posed by sanctions and geopolitical tensions, JTI has decided to maintain its presence in Russia. Notably, the company has partially restored operations at its enterprises in Ukraine and continued to hire new employees due to their strong desire to produce. This decision reflects JTI’s commitment to supporting its workforce and adapting to evolving market conditions.
Last March, JTI announced that it would cease new investments and marketing activities in Russia following the imposition of sanctions. The company also postponed the launch of a heated tobacco device in Russia, which was originally scheduled for the first half of 2022. Terabatake emphasized that unless the business environment improves significantly, they may temporarily suspend production in the Russian market.
JTI currently employs approximately 4,000 people in Russia and operates four factories, including locations in St. Petersburg and Rostov-on-Don. By maintaining operations in Russia, the company aims to minimize job losses and continue its contributions to the Russian economy.
While geopolitical tensions and sanctions have presented significant challenges, JTI’s decision to continue operating in Russia demonstrates its dedication to the market and its confidence in the long-term prospects of its business in the country. By navigating these complexities, JTI aims to provide stability for its employees and ensure a steady supply of its products to consumers.
As JTI moves forward, it will monitor the business environment closely to assess any potential changes that may impact its operations in Russia. The company’s commitment to its employees and customers remains paramount, and it will make informed decisions to adapt to evolving circumstances.
In conclusion, JTI has announced its intention to maintain its factories in Russia despite considering selling its Russian operations in response to geopolitical tensions. The company’s decision reflects its commitment to its workforce, adaptability, and long-term prospects in the Russian market. By navigating challenges and closely monitoring the business environment, JTI aims to continue serving its employees and customers while contributing to the Russian economy.
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