Question-and-Answer Session
Operator
Thank You. We will now conduct the question-and-answer portion of the conference. (Operator Instructions). Our first question is from Judy Hong from Goldman Sachs.
Judy Hong - Goldman Sachs
As we think about 2010 and think about volume outlook. I was hoping to just get your perspective on volume outlook. Is it year-to-date down about 2.1% organic? As you thought to lap some of the challenges that you faced this year and then the macros start to get better globally would you expect to see the volumes sort of start to turn positive as 2010 progresses?
Hermann Waldemer
Well, let me start really with in terms of the perspective, I mean 2% minus 2% organic volume, I believe is an excellent performance for a consumer goods company in a recession. Looking forward, that's the key of your question here is, look I would say, I expect some improvement in 2010 over to 2009, but I would say at this point in time it's impossible to quantify. I mean they all number of factors that influence that situation. Of course the first and most important one is the general question about the economic recovery and also recovery in terms of employment.
A rebound in the stock markets doesn’t mean we get new jobs for the people, there will be a certain lack to that, that is of course one thing, I mean in key markets like Russia, I think that could come and begin to improve in the second half of 2010.
Then of course gets to the next question on really, total market size, development of major markets. Look Russia last year and it is a huge market and it was last year about 400 billion. A year ago it was growing 44%, this year it’s declining 3% to 4%. Is it going to stabilize or even already returned to grow? That's a key question. This major impact is on the total volume number. Indonesia is 250 billion cigarettes market. That market has been growing last year about 10%, now it is growing 3% to 4%. The growth of next year is going to be important.
Another important market is being Japan, also in the range 250 billion cigarettes. It’ll also depend on the new governmental policy on excise tax and I guess we all would love to accept a certain market decline in Japan in exchange for pricing freedom. So, all-in-all it will depend on those key points, we will continue to strike the right balance between price, earnings and volume.
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