BAT factory closure could put 35,000 jobs in risk South Africa at, warns BLSA
IOL previously reported that BAT South Africa has reached its limit in trying to deal with the illicit cigarette trade in South Africa.
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Business Leadership South Africa CEO Busisiwe Mavuso has warned that the closure of British American Tobacco’s only South African cigarette factory could put up to 35,000 jobs at risk.
IOL previously reported that BAT South Africa (BATSA) said it has reached its limit in trying to deal with the illicit cigarette trade in South Africa and is walking away from its production business.
Because of the “devastating impact of the illicit cigarette trade on the local market,” the company will close its only South African manufacturing facility, in Heidelberg, Gauteng, by the end of 2026.
In her weekly newsletter, Mavuso said the closure highlights the wider economic threat posed by the illicit economy, which now accounts for around three-quarters of cigarette sales. She warned that the loss of 230 direct jobs at the factory could ripple across the entire tobacco value chain, affecting farmers, distributors, and retailers, and ultimately putting up to 35,000 livelihoods at risk.
"Some 230 direct jobs will be lost, but the ripple effects could affect 35,000 jobs across the value chain, from the 100 tobacco farmers in Limpopo, North West and Mpumalanga who produced more than seven million kilograms of tobacco last year, through to distributors and retailers," Mavuso said.
Mavuso added that the BAT closure is a warning for other sectors as well, and further called on the government to act urgently.
"BLSA has joined the Illicit Economy Task Force established by the Consumer Goods Council to drive coordinated action. The task force will develop specific proposals for product authentication systems across multiple sectors, create public awareness campaigns about the economic and safety risks of illicit goods and work directly with SARS, the police, and the NPA to identify enforcement bottlenecks and propose solutions."
"We’re bringing together affected industries, from tobacco and alcohol to pharmaceuticals and textiles, to share intelligence on supply chains and criminal networks."
She also said that "business action alone cannot solve this. Government must act with urgency across multiple fronts. SARS needs dedicated resources for its illicit trade task team, including specialised investigators and technology for supply chain monitoring".
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