British American Tobacco (BAT) has announced it will withdraw from the Mozambican market, a move expected to put pressure on South African (SA) authorities to tackle the flow of illegal cigarettes.
The company says illicit trade has eroded its sales volumes by around 40% over the past five years.
BAT, listed in both Johannesburg and London, confirmed its departure from Mozambique but did not provide details on the timeline or potential impact on employment. BAT Mozambique, which once controlled over 90% of the country’s cigarette market, played a major role in the nation’s tobacco value chain and revenue generation.
Walker Diers, Executive Director of the Decide platform, described the exit as “a blow to the country,” highlighting potential job losses and broader economic consequences. “Other companies providing services to BAT will also be affected, and the state will lose significant revenue. The consequences for our economy could be severe,” he said.
Experts also warn that BAT’s departure could exacerbate the illicit cigarette trade between Mozambique and SA. Low-cost illegal products could flood the market, undermining legitimate businesses and reducing tax revenue. Yusuf Abramjee of Tax Justice South Africa noted that the sale underscores the risks of allowing illicit trade to flourish, which he said leads to unfair competition, job losses, and lower fiscal revenue.
–ChannelAfrica–
