How China's Tobacco Industry Will Adjust After Entering WTO

At present, the world economic integration is developing in depth. With China's accession to the WTO, the domestic cigarette industry is undergoing a deeper transformation in the face of new rules and new market competition environment. The cigarette packaging, along with fluctuations in the entire industry, must continue to be adjusted. The following section selected some experts' analysis and suggestions on the future direction of the tobacco industry in China for packaging companies to reference and borrow.
Accelerating corporate restructuring and developing large tobacco enterprise groups must have new ideas for the formation of large tobacco enterprise groups in accordance with China's national conditions. Within 5 to 10 years, large tobacco industry leaders that can compete with foreign tobacco groups should be established and set up 3 to 5 Large-scale inter-regional tobacco enterprise groups nationwide, the Group's tobacco production and sales scale reached more than 3 million boxes. At present, Hongta Group and General Group have inter-provincial mergers and acquisitions of tobacco companies, which has begun to take shape in China's large tobacco enterprise groups. 200,000 to 800,000 cartons of production companies with relatively large production scales gradually move closer to the large-scale tobacco group, encouraging large-scale industrial enterprises and established local tobacco companies to unite and expand their high-speed, high-efficiency mergers and acquisitions with real potential for development. . A small cigarette factory with an annual output of 200,000 cases or less and bankruptcy conditions will be forced to shut down, production points will be abolished, and its production plans will be re-adjusted. Priority will be given to large-scale cigarette companies with an annual output of more than 800,000 boxes. For small and medium-sized cigarette enterprises with an annual output of 200,000 cases or less that are currently profitable, they are assigned to the established tobacco group in batches. If they have mature conditions, they will be disqualified from legal persons, set up production sites, or cancel production points through economic compensation. Within five years, the company will focus on the “domestic market, supplemented by the international market”. It will have the ability to fully compete with domestic and multinational companies, and it will continue to emphasize both international and domestic markets in the medium and long term. It will build factories abroad or merge with foreign tobacco companies. Set up a marketing network, and establish a marketing network by establishing factories abroad or merging foreign tobacco companies to compete with foreign tobacco groups in the international market.
Utilizing WTO Rules to Protect Ethnic Tobacco Enterprises China's accession to the WTO as a developing country can apply the “principle of protection of infant industry” agreed by the WTO and strive for a buffer period of 10 years. During this period, it will increase structural adjustment and enhance its strength. After accession to the WTO, it is possible to use the "safeguard terms" to impose temporary import restrictions on certain imported tobacco monopoly products. China has promised to liberalize the ban on cigarette imports and gradually eliminate quotas for raw materials, but there are corresponding mechanisms and measures behind the commitments. Other methods can be used to take measures against these commitments, such as the establishment of economic and technical barriers to imports from China Tobacco The Group is engaged in the business of tobacco monopoly products and indirectly controls the total amount of imports. Technical barriers to trade are recognized and widely used in the field of international trade. Therefore, China should conduct in-depth research on measures for technical trade barriers in tobacco and apply the technical trade barriers disclosed in the international trade field, including technical indicators, laws, regulations, and other means to legally restrict foreign tobacco groups.
Accelerate the technological innovation of enterprises and adjust the structure of cigarette products in tobacco products. Flue-cured cigarettes are China's characteristics and advantages. At present, the foreign tobacco group has taken a look at the potential of China's flue-cured cigarette market and designed its products specifically for the Chinese market. To break into the Chinese market, open the breakthrough first. China will continue to strengthen the development of tobacco-based cigarette science and technology and technological innovation, reduce product tar content, strengthen marketing, maintain the monopoly position of domestically produced flue-cured cigarettes in the market, and must not allow tobacco-type cigarettes to be put into use due to the development of international mainstream cigarette products. In the world market, hybrid cigarettes are internationally popular products, occupying 90% of the world's tobacco products market. China's current hybrid cigarette products have weak competitiveness and are lagging behind in terms of development level. Therefore, we should focus on the strength of the national tobacco industry, focus on supporting 5-8 large-scale tobacco groups, support 8 brands of hybrid cigarettes within the brand, and intensively manage them. The direction of development will increase the market share of cigarettes in China from 5% to 20% in the short to medium term. (High Moral Yang Meng Pan Xin) ("Tobacco Wine Packaging")

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