PMI Positions Indonesia as Key Asia-Pacific Hub to Drive Innovation and Export of New Tobacco Products

Key Points:

·Strategic Investment: Philip Morris International (PMI) is investing $330 million to establish a factory in Karawang City, West Java Province. This will be PMI's first non-smoking production base in Southeast Asia and the seventh globally.

·Technological innovation: The factory is equipped with the only standardized laboratory in Asia for PMI. A team of 200 Indonesian experts is responsible for research and development. The harmful substances in the products have been reduced by 90-95% compared to traditional cigarettes.

·Market Strategy: In Indonesia, the product portfolio covers heated tobacco IQOS, e-cigarette VEEV, and nicotine pouch ZYN.

·Localization: In 2024, the localized product BLENDS by A, containing clove flavor, will be launched. It will be available in 20 major cities in Indonesia and will use locally sourced tobacco and clove ingredients.

【2Firsts news flash】According to a report from Suara.com on July 3, at the "Technovation 2025" event held in Jakarta, Indonesia, Christos Harpantidis, Senior Vice President of External Affairs at Philip Morris International (PMI), stated that PMI is increasing its local investments in Indonesia through its subsidiary PT HM Sampoerna Tbk, with a focus on expanding the production of smoke-free tobacco products.

He stated that PMI has invested $330 million (approximately 5.35 trillion Indonesian Rupiah) to build a smoke-free tobacco product factory in Karawang, West Java Province. The factory, which began construction in 2023, is PMI's first in Southeast Asia and its seventh globally focused on the manufacturing of smoke-free tobacco products.

"The facility is equipped with a testing and analysis laboratory that meets global standards. It is PMI’s only advanced laboratory in Asia, supported by around 200 highly qualified local experts. These top Indonesian talents are responsible for testing and analyzing the quality of smoke-free products, which are distributed not only in the Indonesian market but also to PMI branches worldwide."

In addition, PMI also emphasized Indonesia's strategic role as a hub for innovation, production, and exports of smoke-free products in the Asia-Pacific region.

Christos stated that true innovation that can bring about real change can only be achieved by combining unique characteristics and needs of the local market, and gaining support from cross-sector collaboration.

This is the reason why we are investing in Indonesia, not only because of its strategic size, but also because we see the potential for achieving better reforms through strong collaboration with stakeholders. We believe that meaningful innovation comes from collaboration, not from fighting alone.

President Ivan Cahyadi of Sampoerna stated that The company's product portfolio includes heated tobacco products such as IQOS with TEREApod, IQOS BONDS with special BLENDS by Apod, VEE e-cigarette, and ZYN nicotine pouches. Ivan mentioned:

"Starting from the fourth quarter of 2024, we have also introduced IQOS BONDS heated tobacco, accompanied by a special BLENDS by A pod to cater to adult consumers' preferences, all at a more affordable price. BLENDS also offers a clove flavor made from cloves originating from Indonesia, currently being sold in 20 major cities in Indonesia."