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Tuesday, 11 May 2021

Striking workers claim victory at Egypt's cigarette monopoly

Two-day strike for better pay and conditions at state-owned Eastern Company cigarette manufacturer ends after investment minister promises to meet workers' financial demands

Bassem Abo Alabass, Wednesday 19 Dec 2012
Eastern Company
Inside Eastern Tobacco Co. (Photo: Al-Ahram Arabic)

Around 23,000 workers at Egypt’s cigarette monopoly, Eastern Company, have ended their two-day strike after the investments minister promised to meet their financial demands, a source familiar with the matter told Ahram Online on Wednesday.

For two days, striking workers had been hampering traffic on Al-Haram Street in Giza to demand the dismissal of the company chairman, Nabil Abdel Aziz, and to call for better pay and conditions. 

They demanded that at least 6,000 temporary workers be put on permanent contracts and for a rise in bonuses from 15 to 30 per cent to reach LE150 per month ($24.30).

“They will now receive a meal allowance of LE400 per month,” the source added, confirming that manufacturing and production lines had resumed work.

The workers agreed to drop their demand that the chairman step down.

Eastern Company posted a net profit of LE631 million (US$105.9 million) last year, down 26 per cent from a year earlier, the stock exchange said in July 2011.

The cigarette monopoly made a net profit of LE850.4 million in fiscal year 2009/2010, according to a statement sent to the bourse.

Three companies are currently licensed to make and sell cigarettes in Egypt, led by the state-owned Eastern Company, whose cheaper Cleopatra brand has long dominated the market. Two foreign companies also operate in the local market, BAT-Egypt and Phillip Morris International, both of which use Eastern Company factories to manufacture their products.

Last week, Egyptian President Mohamed Morsi announced he would raise taxes on consumer goods, including cigarettes. Taxes on locally produced cigarettes were due to go up by LE2 per pack and by LE2.50 on imported brands. Morsi later reversed the decision and called for dialogue.


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