Philip Morris International to Boost Investment in the Philippines, Aiming to Make It a Smoke-Free Products Export Hub

Key Takeaways：

· Regulatory edge: PMI calls the Philippines’ regulatory environment “very progressive,” with potential to become an export hub for smoke-free products.

· Factory shift: Philippine facilities are being fully converted to produce heated tobacco (HnB) products.

· Large market: With about 16 million smokers, PMI plans to introduce more affordably priced smoke-free products.
 

2Firsts, October 11, 2025 — Citing The Philippine Star, Philip Morris International (PMI) says that, given the Philippines’ “highly forward-looking” regulatory system and investor-friendly climate, the company is considering building the country into an export hub for its science-based smoke-free products.

The Philippines Could Become a Major PMI Smoke-Free Production Base

PMI CEO Jacek Olczak said the company has not built new cigarette factories over the past decade, instead converting some existing plants—including one in the Philippines—into production bases for smoke-free products.

Christos Kiritsis, PMI’s VP for smoke-free products across South Asia, Southeast Asia, the CIS, the Middle East, and Africa, noted that the Philippines is among the few countries with a comprehensive regulatory framework for smoke-free products. Its “very progressive” system creates favorable conditions for investment and exports. He added that beyond its investment appeal, the Philippines has a large domestic market that is crucial to PMI’s future plans.

Doubling Down on Smoke-Free: $14 Billion Invested Globally

In the Philippine market, PMI currently offers multiple smoke-free alternatives, including the heated tobacco product IQOS and ZYN nicotine pouches, giving legal-age consumers options to consume nicotine without combustion.

Olczak said PMI has invested about $14 billion over the past decade in the R&D and commercialization of smoke-free products, which now account for 41% of the company’s global net revenues. He revealed PMI is developing a next-generation IQOS, improved nicotine pouches, and new vaping devices, and will continue to expand investment.

Philippine Facilities Under Full Conversion

PMI and its local affiliate PMFTC Inc. operate a 1.2-hectare plant in Tanauan, Batangas, opened last year and now dedicated to producing specialized sticks for smoke-free products. Olczak said the company emphasizes employee retraining during the transition to ensure staff can remain engaged in smoke-free production as cigarette operations wind down.

Serving 16 Million Smokers: Expanding More Affordable Options

Kiritsis noted there are still about 16 million smokers in the Philippines. PMI plans to launch more price-competitive smoke-free products locally to broaden market coverage. He said PMI’s second-generation HnB device Bonds—previously piloted in the Philippines—could return, aimed primarily at Asian consumers at price points closer to cigarettes, and, according to PMI, capable of reducing harmful constituents by about 95%.

As of mid-year, among roughly 1 billion smokers worldwide, approximately 41 million adults use PMI’s smoke-free products.