An Emerging Market of E-cig With a Population of 600 Million, Southeast Asia is Getting Hot!

There are some recent trends in the Southeast Asia vape market. The Philippines' proposed vaping bill, set to take effect in May 2022, removes restrictions on flavors and online advertising, the proposed measures also allow products such as vaping and HTP to be distributed at point-of-sale, through direct marketing, and on the internet advertising and promotions. The implication is that the Philippines is very liberal in terms of taste and online sales.

E-cigarettes sales are allowed on E-commerce platforms in Southeast Asia

There are 600 million people in Southeast Asia, covering 11 countries. Among them, Indonesia, Malaysia, the Philippines, and Vietnam are relatively "friendly", and they are also the most popular emerging markets for e-cigarettes in Southeast Asia. It is worth noting that some countries in Southeast Asia also allow e-cigarettes to be sold online.

Major e-commerce platforms sell electronic cigarettes as normal electronic products. Such as Vietnam's Tiki comprehensive B2C e-commerce website; Indonesia's Blibli's B2C platform; Indonesia's representative C2C online trading platform BukaLapak; the Tokopedia e-commerce platform focusing on the Indonesian market; the largest Lazada online shopping website in Southeast Asia, covering Indonesia, Malaysia, Philippines, Thailand, and other users; Shopee, an e-commerce platform in Southeast Asia and Taiwan, radiates more than 10 markets including Singapore, Malaysia, the Philippines, Thailand, and Vietnam.

Southeast Asia is an emerging e-cigarette market with a huge market space.

According to Euromonitor data, the total market for electronic atomization in Southeast Asia is expected to reach US$766 million in 2023. However, it should be noted that the consumption level of e-cigarettes in Southeast Asia is not too high. At present, Juul and MOTI are doing well in Southeast Asia.

Some countries in Southeast Asia are open to e-cigarettes.

Indonesia

Indonesia can enter the market by applying for sales certification, tax e-cigarettes as legal tobacco products, and not restrict their flavors. Indonesia should be one of the largest concentrations of e-cigarettes in Southeast Asia, where there are about 200 manufacturers and traders of new tobacco products. As a country with a population of nearly 300 million, its attitude toward e-cigarettes has been declared legal in 2018. It only needs to apply for a sales license to give full play to it. However, it is precise because of the large e-cigarette market in Indonesia and the high local tax collection, that the retail price tax rate of e-cigarette products reaches 57%.

Malaysia

The e-cigarette policy in Malaysia is still being perfected, and e-cigarette products can be sold and used. But not very friendly to nicotine, Malaysia bans nicotine-containing vaping products from being marketed, distributed, or imported, and can only be sold by licensed pharmacies or registered doctors.

When it comes to the market, the market share of e-cigarettes in Malaysia is very high, which is much higher than that of traditional cigarettes. A study by the Malaysian Vaping Chamber of Commerce (MVCC) shows that Malaysia's e-cigarette industry is worth 2.27 billion ringgit (about US$558 million) and accounts for a 42% share of the overall tobacco market - more than illicit cigarettes (37%) and legal cigarettes Cigarettes (21%) ), is a booming industry. The lucrative e-cigarette industry will continue to grow as the number of industry players increases.

At present, the tax on electronic cigarettes in Malaysia is not high. All types of electronic vaping products are subject to a tax rate of 10% of the retail price, resulting in a specific tax of RM0.4 per millimeter of liquid.

Philippines

The Philippines only needs to apply for a business license. Electronic atomization products are classified as pharmaceutical products and medical devices, which are regarded as "harm reduction auxiliary products". The import and sales of electronic cigarettes need to be registered and licensed by the Food and Drug Administration. It also has a proposed vaping bill this year: set to take effect in May 2022, removing restrictions on flavors and online advertising.

Vietnam

Vietnam restricts imports, but vaping products can be sold and used in Vietnam. Its state-owned vaping company (VINATABA) imports more than 50% of the local e-cigarette market. However, it has recently been pointed out that Vietnam will introduce strong policy measures to prevent young people from using e-cigarettes. In 2019, the Vietnamese Ministry of Health recommended banning e-cigarettes, but the government said "I don't care", VNTCF is the Vietnamese government tobacco control agency, and all policies are still "in the game"!

The latest policy also points out that e-cigarettes can be exported to Southeast Asia, Vietnam, Indonesia, the Philippines, etc., but Myanmar, Laos, and Cambodia are more strict or prohibited, while Brunei and East Timor prohibit the sale of e-cigarettes but can use e-cigarettes. Some countries have also recently put forward requirements for the import of electronic cigarettes. For example, Malaysia requires that imported electronic cigarettes pass SIRIM verification in August! The certification process is to submit an application - document review (test report must be submitted) - factory audit - certificate review - certificate issuance - purchase of labels - surveillance audit after certification.

Compared with these measures, what attracts vape brands’ attention is the promising market in Southeast Asia in the future. Several big e-cigarette companies are considering setting up part of their production capacity in Southeast Asia, such as RELX, MOTI, MOOSE, SNOW PLUS, and JinJia Shares have an in-depth layout in Southeast Asia. Since last year, more than 20 Chinese e-cigarette manufacturers are also been "relocating", and this destination is overseas in Southeast Asia, most of them are leading enterprises in this industry. Moreover, the Southeast Asian market is still growing explosively. Many foreign trade companies place orders from factories and finally send them to countries such as Indonesia.