Egypt’s top cigarette maker Eastern company raised the prices of some of its popular cheap cigarettes on Wednesday, the company said in a bourse filling.
Eastern Company, which supplies 70% of Egypt’s cigarette market, raised the price of three of its low-cost, Cleopatra brand cigarette products by between 4.2 and 17.6%.
The move comes a few days after Egypt hiked the value-added tax, electricity, and fuel prices, part of a reform programme aimed at reviving the economy under a three-year, $12 billion loan agreement with the International Monetary Fund (IMF).
The company attributed the increase to higher production cost.
The company’s CEO told Reuters that raw materials that had been imported at an exchange rate of EGP 9/USD were at low levels.
The price rise was needed because the company now had to import at a rate of EGP 18/USD, he added.
The Egyptian pound has halved in value since Egypt floated its currency in November, making imports more expensive.
In October, Eastern Company said it was having problems buying raw materials because of Egypt’s dollar shortage.
In a separate note, the Ministry of Finance said in a press release that the company raised its products’ prices on its own accord without any governmental intervention.
“The products prices hike is the company’s own decision. It is nothing to do with the recent increases in VAT,” the ministry explained.