How important is the cigar industry for a country like the Dominican Republic? It is calculated that around 500 million premium cigars will be produced around the world. According to Hendrick Kelner 220 million of these will come from the Dominican Republic. There has also been an enormous increase in the export of machine made cigars in the last couple of years.
In 2010, the Dominican Republic exported 950 million of these premium cigars alone and these numbers rise every year. “Nicaraguan cigars are hot in the US, but Dominican cigars remain number one. In Europe there is still a match between Dominican and Cuban cigars, but we gained eight points of share there, mostly due to the crisis in Spain, which is a core market for Cuban cigars.
One of the main reasons for the Dominican Republic’s success is the concentration of cigar related business in the city of Santiago according to Hendrik Kelner. “There is a big cluster here and as a cigar producer you will find all you need”. You have people manufacturing boxes, machines, parts; you have machine operators, factories, greenhouses, high tech fertiliser companies, and there is a lot of business with the US since it’s so close.
You also don’t have to import tobacco from other countries, so this is where it’s all happening. All in all, there are between 40 and 60 factories in the Dominican Republic, and about 120,000 people work directly with cigars, so the impact on the country is evident.
It is a big source of employment and I am not sure how much the government gets, but we export cigars for about 500 millions dollars each year. Guillermo Leon, CEO of La Aurora cigars explains: It’s also estimated that for each person directly involved with cigars there are three more, indirectly working for the industry, like in transportation.
In addition the industry has another indirect and important effect according to Litto Giomez, CEO of La Flor Dominican. Thousands of people come here just for cigars. They know the Dominican Republic because of the cigars. They might come again and discover everything else the country has to offer.