Cigarette volume sales continued to decline in Belgium in 2020. The main reasons were the closure of the borders and travel restrictions owing to COVID-19.
The illicit trading of cigarettes grew again in Belgium in 2020, with volumes accelerating compared with the previous year, and even the closure of the borders as part of measures to combat COVID-19 did not stop this development. Indeed, the plain packaging law is making cigarettes easier and cheaper to copy, although Belgian authorities did succeed in dismantling quite a few counterfeiting factories and logistic centres in the country in 2020.
Working from home is likely to have had a negative impact on consumption in 2020 as many office workers feel less stressed when not in the office and therefore take fewer “cigarette breaks”, while many family members often try to discourage smoking in the home. With the travel ban in place, Belgians were also unable to purchase duty-free cigarettes, which mitigated the retail volume decline to some extent as purchasing channels were reduced.
Demand for cigarettes is expected to continue to decline in the forecast period, for several reasons. Firstly, the Belgian government plans to increase taxes again on cigarettes for three consecutive years, impacting negatively the cross-border market.
Cigarettes are generally not discretionary products, with nicotine being highly addictive. Although the Belgian government continues to communicate the dangers of smoking, quitting can be a difficult process.
Although habitual smokers tend to prioritise smoking in their budgets, disposable incomes will inevitably be constrained as the country recovers from the economic impact of COVID-19. This will lead some smokers to continue to favour lower-priced brands, leading to limited growth in the average unit price over the forecast period.
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This report originates from Passport, our Cigarettes research and analysis database.
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