Relationship to the tobacco industry

Between July 2017 and April 2019, ADIT received funding from Philip Morris International (PMI) as part of PMI IMPACT, for the so-called “Rogue trade project”, dedicated to the “Development of a pan-European awareness platform, based on digital communication tools, to inform European businesses about the illegal trade of tobacco products and other mass consumption goods.”³

The project notably led to the creation of Eurobsit (European Observatory on Illicit Trade), a website dedicated to illicit trade.⁴

ADIT and PMI IMPACT also co-sponsored a conference on smuggling, counterfeiting, and terrorism financing, organized by Fondation Robert Schuman on 11 April 2018.⁵ The Association de Lutte Contre le Commerce Illicite (ALCCI, the association against illicit trade) was a sponsor for the event.⁵ ALCCI was founded by PMI Expert Council member Alain Juillet.⁶ EU commissioner Pierre Moscovici and other EU officials cancelled their participation following the publication of media articles on PMI funding the conference.⁷ Attendees included senior officials from Europol, the European Parliament, the European External Action Service, the European Union Intellectual Property Office, French and Belgian governments, and the OECD, in addition to other PMI IMPACT grantees (including from INTA and the Siracusa International Institute) and Alvise Giustiniani, Vice-President of illicit trade strategy and prevention at PMI.⁵

An investigation by the Organized Crime and Corruption Reporting Project (OCCRP) revealed further information about the links between ADIT and the tobacco industry.⁸ It points to an ADIT report from 2016 (shortly before the beginning of the PMI-IMPACT funded project in July 2017), which was co-authored by two members of the PMI IMPACT Expert Council.⁸

TobaccoTactics Resources

• PMI IMPACT
• List of Successful PMI IMPACT Applicants
• Organisations linked to PMI IMPACT
• Illicit Tobacco Trade

References

The post ADIT appeared first on TobaccoTactics.

Image source: © Guillaume Piolle/CC BY 3.0

Key Points

• Lebanon is located on the eastern shore of the Mediterranean Sea. It is served by the World Health Organization’s Regional Office for the Eastern Mediterranean (EMRO).
• It has a population of 5.5 million, with an estimated tobacco use prevalence for those aged 15 and over of 39%.
• Lebanon ratified the WHO Framework Convention on Tobacco Control (WHO FCTC) in 2005. It has not ratified the Protocol to Eliminate Illicit Trade in Tobacco Products.
• Lebanon has a state-owned tobacco monopoly, the Regie Libanaise de Tabacs et Tombacs, known as the Regie, which controls the domestic market. Transnational tobacco companies only have access to the Lebanese market through the Regie.
• In recent years, tobacco industry lobbying has prevented the introduction of graphic health warnings; the Regie has sought to influence Lebanon’s delegation to the Conference of the Parties (COP) to the WHO FCTC; and the industry has conducted extensive corporate social responsibility activities, some of which have involved Lebanese state institutions.

Lebanon has some of the highest rates of tobacco use in the world. It is ranked third in the world for cigarette consumption per capita.⁹ A 2019 survey also suggested that waterpipe use prevalence is particularly high, and higher amongst women than men.¹⁰ Tobacco products were easily affordable until the start of Lebanon’s economic crisis in 2019.⁹ Though they have become less affordable since then, the decline in affordability has been weaker compared to that for other goods.¹¹ At just 9.9% of the retail price, the tax imposed on tobacco products falls well short of the 75% recommended by the World Health Organization (WHO).¹²¹³ Though a comprehensive tobacco control law was introduced in 2011, there have been major challenges with implementation and enforcement.¹⁴

Tobacco Use in Lebanon

In 2022, the population of Lebanon was 5.5 million.¹⁵ In 2019, the WHO estimated overall tobacco use prevalence to be 39% amongst the population aged 15 and over, based on all national survey data from 1990.¹⁶ An academic study carried out in 2019 found similar results. Based on a cross-sectional household survey, it found prevalence of cigarette smoking among adults aged between 18 and 69 of just over 35% (49% males; 21.5% females).¹⁰ It also found overall waterpipe use prevalence of 39.5%, and at over 46%, prevalence for women was higher than for men (nearly 33%).¹⁰ Almost half of current cigarette smokers reported smoking more than 20 cigarettes per day, while most waterpipe users smoked at least three sessions per week.¹⁰

In 2017, Lebanon reported tobacco use among boys aged 13-15 of 35% – the highest amongst the 19 EMRO countries which carried out the Global School-based Student Health Survey between 2001 and 2018.¹⁷ The corresponding figure for Lebanese girls that year was 28%.¹⁷ A study carried out amongst Lebanese adolescents aged 11 to 18 between 2016 and 2017 found ever use of waterpipe of 34%.¹⁸

There were an estimated 7,810 deaths attributable to smoking in 2019, accounting for over 23% of all mortality in Lebanon for that year.¹⁹ A study published in 2014 put the economic burden of tobacco use in Lebanon in 2008 at US$326.7 million, or 1.1% of national GDP.²⁰

A 2019 study on e-cigarette use amongst school and university students aged from 17 to 23 found that 14.5% reported ever use, with 8% reporting current use.²¹ However, at the time of writing, data on e-cigarette use amongst Lebanese adults remains scarce.

Tobacco in Lebanon

The Lebanese state tobacco monopoly

The Lebanese tobacco industry is controlled entirely by a state-owned company, the Regie Libanaise des Tabacs et Tombacs (referred to here as “the Regie”).²²²³ The Regie has exclusive rights to tobacco manufacturing and distribution, tobacco imports and exports, and to the purchase of locally grown tobacco leaf. It also oversees an anti-smuggling unit.²⁴ The Regie distributes local and imported tobacco products to licensed wholesalers, at prices it determines with the Ministry of Finance (MoF).²⁴²⁵ These wholesalers then sell the tobacco products to retailers across Lebanon.²⁴ Though these retailers are also licensed by the Regie, they are not under its direct control and largely depend on the wholesalers for their tobacco supply.²⁴ The Regie sets the profit margin and weekly quota of sold tobacco for both wholesalers and retailers.²⁴

Overseen by the MoF, the Regie’s performance has a direct impact on the public treasury.²⁴ Not only does this provide the Regie with significant access to policy makers, it also creates conflict with other government departments (such as Health), as the MoF may oppose measures which damage the Regie’s profitability.²⁴¹⁴

Market share and leading brands

As of 2022, the Regie had a share of over 55% of the tobacco market, up from 45% in 2017.²⁶ The leading transnational tobacco company (TTC) in Lebanon was Philip Morris International (PMI), with a market share of nearly 15%, followed by Japan Tobacco International (JTI) on over 11%, Imperial Brands on almost 10%, and British American Tobacco (BAT) on 6.5%.²⁶

Transnational tobacco companies (TTCs) only have access to the Lebanese market via the Regie. In return for purchasing Lebanese tobacco leaf, the Regie imports manufactured tobacco products to sell on the Lebanese market and buys Virginia tobacco leaf for the manufacture of local brand cigarettes.²⁴ Since 2016, international brands have also been made in Lebanon at Regie manufacturing facilities, as per agreements with the Big Four TTCs.^27282930

The Regie brand Cedars is by far the most popular brand of cigarettes in Lebanon, with a market share of 55% in 2022.³¹ PMI’s Marlboro is in second place with a share of around 14%.³¹ JTI’s Winston is third (8%), followed by BAT’s Kent and Imperial Brands’ Gitanes (both around 5%).³¹ All other brands have a market share of 3% or less.³¹

Tobacco farming and child labour

In 2020, tobacco was being cultivated on 1.32% of Lebanon’s agricultural land.³² In 2021, tobacco production was just over 10,000 tonnes, down slightly from a high of 12,800 tonnes in 2001.³³ This makes Lebanon the fifth-largest tobacco producer amongst the 14 EMRO countries for which data is available.³⁴

Lebanese tobacco leaf is purchased exclusively by the Regie via a price support programme, under which the Regie purchases from farmers at a given yearly price and quantity which is determined by the MoF.²⁴ According to Hamade (2014), the price paid is well over the average paid to farmers in other sectors in Lebanon; essentially, it is a subsidy which reinforces farmers’ dependence on tobacco growing and disincentivises any transition towards other crops.²²²⁴

Lebanese tobacco featured on the 2022 List of Goods Produced by Child Labor or Forced Labor produced by the U.S. Department of Labor.³⁵ Tobacco production is very labour intensive and involves all or most members of the household, which includes women and children.²² On top of enduring poor wages and working conditions, female workers are also at risk of sexual violence in tobacco-growing communities.³⁶

• For information on tobacco industry responses to accusations of complicity in child labour, please see the pages on CSR: Child Labour and the Eliminating Child Labour in Tobacco-Growing Foundation (ECLT).

Tobacco and the economy

Lebanon is a net importer of raw tobacco. According to Comtrade data, in 2022, it imported over US$40.5 million in raw tobacco, compared to under US$16.4 million in exports.³⁷³⁸

Lebanon is also a net importer of cigarettes. In 2022, Lebanese cigarette imports were nearly US$16.5 million, compared to less than US$1 million in exports.³⁹⁴⁰

It is also a net importer of waterpipe tobacco. Its imports were worth US$17.3 million in 2022, compared to exports of under US$70,000.⁴¹⁴²

Illicit trade

Industry documents suggest that illicit trade was used by the TTCs as a means of building market share and furthering regional expansion during the Lebanese Civil War (1975-1990).⁴³ With governance weak and legal cigarette production in decline, the TTCs flooded the Lebanese market with cheap contraband products.⁴³ Though the government made direct appeals to these companies, requesting that they stop supplying distributors involved in this illicit trade, it had little effect.⁴³ The documents also show that the TTCs sought to use the issue of illicit trade as leverage in negotiations on establishing manufacturing presence in the country.⁴³

Today, reliable data on the scale of the illicit trade in Lebanon are not available. An industry-funded report by the consultancy Oxford Economics (OE) indicated that by the first quarter of 2019 the illicit trade accounted for 28.1% of the market in tobacco products.⁴⁴⁴⁵ However, this data may not be reliable given OE’s long relationship with the tobacco industry. Not only was this particular study funded by PMI, BAT and JTI, but also prepared according to terms of reference agreed with all three companies.⁴⁵ These terms of reference are not disclosed, while the methodology used is highly susceptible to industry interference.⁴⁶

Exaggerating the scale of illicit trade is a well-documented tactic which has been used by the tobacco industry all over the world as a means of opposing tobacco control regulations. See Illicit Tobacco Trade for further details.

• For more information on the tobacco industry in Lebanon, please see the Tobacco Supply Chain Database.

Roadmap to Tobacco Control

Lebanon ratified the WHO FCTC in 2005.⁴⁷ It has yet to ratify the Protocol to Eliminate Illicit Trade in Tobacco Products.⁴⁸

In August 2011, Lebanon passed Law No. 174, its first ever tobacco control law.¹⁴ This was the result of years of advocacy led by the National Tobacco Control Program (NTCP) (a government organisation within the Ministry of Public Health), alongside academics, tobacco control advocates, civil society organisations, local and international NGOs, and policy makers.¹⁴ Law No. 174 banned smoking in all indoor public spaces; banned tobacco advertising, promotion and sponsorship; and introduced larger text warnings on tobacco products, with the potential to add graphic health warnings at a later date.¹⁴

However, enforcement remains a challenge, particularly regarding the provision for smokefree spaces. This measure was properly enforced for just three months, thanks in part to strong lobbying from restaurants and other establishments offering waterpipe.¹⁴ There has also been a lack of political will to enforce the law.¹⁴ In late 2012, the then Minister of the Interior implied that the police would be flexible about enforcing the law during the holiday period.⁴⁹ The Ministry of Tourism also stopped enforcing the law, alleging a negative impact on Lebanon’s tourist industry and stating that it did not have the resources necessary to monitor implementation.¹⁴⁵⁰

For more details, please see the following websites:

• Legislation by country – Lebanon, Tobacco Control Laws, Campaign for Tobacco Free Kids
• Lebanon, WHO FCTC Implementation Database, WHO FCTC Secretariat
• Country profile – Lebanon, World Health Organization, WHO report on the global tobacco epidemic 2021

Tobacco Industry Interference in Lebanon

Tobacco industry tactics in Lebanon include lobbying, which has prevented the introduction of graphic health warnings; attempting to influence Lebanon’s delegation to the Conference of the Parties (COP) to the WHO FCTC; and corporate social responsibility.

Portraying tobacco as a symbol of resistance

Part of the revenue the Regie collects from imported tobacco products is used to cover the subsidies given to tobacco growers in rural areas, particularly in the south of the country.²⁴¹⁴ Given that this area was previously occupied by Israel, keeping farmers on this land is seen by the state as an important geopolitical objective.¹⁴ Indeed, both Nassif Seklaoui, Chairman and General Manager of the Regie, and the speaker of the Lebanese parliament, have explicitly linked tobacco growing to the struggle of the Lebanese people and their resistance to foreign occupation.⁵¹ Such strategies aim to instil the belief that tobacco is a strategic industry and a source of national pride. As the opening statement of a Regie pamphlet from 2011 reads, “The tobacco crop has become a symbol of resilience, resistance and people’s attachment to the Nation’s land.”²²

Influencing policy: health warnings

Law 174 significantly increased the size of the textual health warnings on tobacco products in Lebanon, from 15% to 40% of the principal surface areas.¹⁴⁵² A further decree in 2012 defined the text of the warnings, though implementation was delayed, reportedly due the Regie lobbying the Minister of Finance.⁵³⁵⁴ Since then, the larger text warnings have been widely implemented – though the measure still falls short of the 50% or more coverage recommended by the WHO FCTC.⁵⁵⁵⁶

Law 174 did also allow for the introduction of graphic health warnings (GHWs) at a later date, subject to the signing of an implementation decree by the Ministry of Health and the Ministry of Finance.⁵⁵ According to Lebanese tobacco control advocates, of all provisions in Law 174, this was the hardest to obtain, due to fierce opposition from the tobacco industry, including the Regie.⁵⁴ During discussions on Law 174 in 2011, some members of the Lebanese parliament objected to the inclusion of GHWs, echoing industry positions on the issue.⁵⁴ Though the implementation decree for GHWs was elaborated in 2011 and updated in 2016, it has still not been approved, reportedly due to industry interference and lobbying.⁵⁵ As of 2021, GHWs had yet to be implemented.⁵⁷

Interacting with the Lebanese delegation to the COP

In 2018, the Regie hosted a meeting attended by six government officials at its headquarters, ahead of the Eighth Session of the Conference of the Parties (COP8) to the WHO FCTC. In the Regie’s own words, the meeting aimed to define a position that “addresses the threats that the items on COP8 agenda for next October pose to tobacco sector”.⁵⁸ There was also a presentation laying out the Regie’s positions on decisions made at the previous COP, as well as the proposals to be discussed at COP8.⁵⁸

Delivering this presentation, Mariam Hariri, the Regie’s Head of General Management, stated:

“We cannot look at tobacco sector only from the perspective of health damage; we must rather look at it with a comprehensive and impartial view. We must take into consideration the economic benefits it offers and the specificity of Lebanon.”⁵⁸

This meeting contravened the implementation guidelines for Article 5.3 of the WHO FCTC, which urge parties to limit interactions with the tobacco industry to those strictly necessary for effective regulation of the industry and its products.⁵⁹

The Regie has also lobbied foreign diplomats. In May 2022, the German ambassador to Beirut visited Regie headquarters in Hadath. He was briefed on “the Regie’s achievements in agricultural, industrial, and commercial fields, among others, as well as about the societal role that it had played during the recent years.”⁶⁰

• For more on the relationship between diplomats and the tobacco industry, please see Diplomats Lobbying for Tobacco Companies.

Corporate social responsibility

In 2016, the Regie launched its sustainable development plan, entitled “Development Vision for a Brighter Tomorrow”. Its stated aim was “promoting economic development, environment protection, fighting illicit trade & child labor, and improving the living of workers & farmers and the communities where we operate.”⁵¹ The plan was launched at a ceremony which was supported by the speaker in the Lebanese parliament, and attended by notable figures from business, politics, finance and the trade union movement.⁵¹ These included senior civil servants from government departments including the Ministry of Finance, the Ministry of Economy and Lebanese customs.⁵¹

Since then, the Regie has conducted extensive CSR activities, including some directed at or involving Lebanese state institutions. For example, it donated US$2.6 million to the Lebanese Army in 2021.²⁴ It also engaged in CSR during the COVID-19 pandemic, donating US$1 million to the Lebanese government to support repatriating Lebanese students abroad and to buy ventilators for COVID-19 patients.⁶¹

The Regie has also organised “women empowerment training sessions” for the daughters of tobacco farmers in different areas of Lebanon. These sessions had the support of local authorities; for example, some were held in municipal buildings or involved the participation of local councillors.⁶²⁶³

The Regie has also carried out CSR in partnership with TTCs. In 2017, in an initiative financed by PMI Lebanon, the Regie offered scholarships to 136 children of tobacco farmers in the north of the country – the fourth consecutive year it had done so.⁶⁴

• For more on tobacco industry activity during the pandemic, please see the COVID-19 Tobacco Tactics page and the COVID-19 monitoring database.

Relevant Links

• AUB tobacco researchers and Lebanese activists press conference on economic impacts of Law 174: The tobacco control law is good for the economy and public health, American University of Beirut
• Prevalence of cigarette and waterpipe tobacco smoking among adults in three Eastern Mediterranean countries: a cross-sectional household survey, R. Nakkash, Y. Khader, A. Chalak, R. Abla, N. M. E. Abu-Rmeileh, A. Mostafa, M. Jawad, J. H. Lee and R. G. Salloum, BMJ open, 2022, 12(3), e055201
• The passage of tobacco control law 174 in Lebanon: reflections on the problem, policies and politics, R.T. Nakkash, L. Torossian, T. El Hajj, J. Khalil and R.A. Afifi, Health Policy and Planning, 2018, Volume 33, Issue 5, pp. 633–644
• K2P COVID-19 Series: Prompting Government Action for Tobacco Control in Lebanon during COVID-19 Pandemic, R. Saleh, R. Nakkash, A. Harb and F. El-Jardali, 2020, Knowledge to Policy (K2P) Center, Beirut, Lebanon
• The Economics of Tobacco in Lebanon: An Estimation of the Social Costs of Tobacco Consumption, Salti, J. Chaaban and N. Naamani, Substance Use & Misuse, 2014, 49:6, 735-742

Tobacco Tactics Resources

• Eastern Mediterranean Region
• Oxford Economics
• Tobacco Farming

TCRG Research

• The Lebanese Regie state-owned tobacco monopoly: lessons to inform monopoly-focused endgame strategies, H. Alaouie, J.R. Branston and M.J. Bloomfield, 2022, BMC Public Health, 22, 1632.
• Developing more detailed taxonomies of tobacco industry political activity in low-income and middle-income countries: qualitative evidence from eight countries, B.K. Matthes, K. Lauber, M. Zatoński, L. Robertson, A.B. Gilmore, BMJ Global Health 2021;6:e004096.
• Tobacco industry commissioned reports on illicit tobacco trade in the Eastern Mediterranean Region: how accurate are they? Sandberg, A.W.A. Gallagher and R. Alebshehy, 2020, Eastern Mediterranean Health Journal, 26(11):1320–1322.

For a comprehensive list of all TCRG publications, including research that evaluates the impact of public health policy, go to TCRG publications.

References

The post Lebanon Country Profile appeared first on TobaccoTactics.

Image source: SavoryCrowdad/CC BY-SA 4.0

Key Points

• India is a country located in South Asia, part of the World Health Organization’s South-East Asia Region.
• It had a population in 2022 of 1.42 billion. Amongst those aged 15+, tobacco use prevalence is 28.6%.
• Smoking prevalence in India is 10.7%. However, the most popular form of tobacco in India is smokeless tobacco, with use prevalence of 21.4%.
• India ratified the WHO Framework Convention on Tobacco Control in 2004, and the Protocol to Eliminate Illicit Trade in Tobacco Products in 2018.
• The Indian cigarette market is dominated by four companies, which together accounted for 98% of sales in 2022. ITC Limited holds by far the largest market share, at over 73%.
• The tobacco industry has deployed a wide range of tactics in India in recent years, including mobilisation of front groups and third parties; litigation against tobacco control measures such as graphic health warnings; and corporate social responsibility, including in partnership with government.

Since the early 2000s, India has made significant progress in tobacco control, introducing a comprehensive tobacco control law in 2004, reducing the affordability of tobacco products, and introducing graphic health warnings (GHWs) consistent with best practice worldwide.⁶⁵⁶⁶ However, major challenges persist. The wide range of tobacco products available in India makes regulation and enforcement particularly complicated. The Indian state is also a major shareholder of ITC Limited, which has by far the largest share of the Indian market. This means that the government has an interest in socio-economic issues – such as ensuring the welfare of farmers and manual labourers working in the Indian tobacco industry, and protection of exports – as well as in public health.⁶⁷

India remains the world’s second largest consumer, producer and exporter of tobacco.⁶⁸⁶⁹

Tobacco Use in India

In 2022, the population of India was 1.42 billion.⁷⁰ In the 2016-17 Global Adult Tobacco Survey (GATS), approximately 29% of the population aged 15+ reported current tobacco use – over 42% of males, and over 14% of females.⁶⁶⁷¹ This means that in absolute numbers, there were almost 267 million tobacco users in India aged 15 and over.⁶⁸ In the 2019 Global Youth Tobacco Survey (GYTS), amongst adolescents aged from 13 to 15, 8.5% reported using some form of tobacco – nearly 10% of males, and over 7% of females.⁶⁶⁷²

Amongst India’s smokers, the most popular product was not factory-made cigarettes but bidis: cigarettes rolled by hand in a dried leaf of the tendu tree. 7.7% of Indian adults reported smoking bidis, compared to 4% who smoked cigarettes.⁷¹

However, the most popular tobacco product in India overall is smokeless tobacco (SLT). More than 21% of Indians aged 15 and over reported being SLT users, compared to less than 11% who smoked, whether cigarettes, bidis, or both.⁶⁶⁷¹ SLT use is also significant amongst women and girls: nearly 13% of females aged 15 and over were SLT users, compared to 2% who smoked.⁶⁶⁷¹ The majority of female tobacco users in low- and middle-income countries (LMICs) are SLT users in India and Bangladesh.⁷³ However, amongst adolescent tobacco users, smoking is more common than SLT use. Over 7% of adolescents reported current smoking, compared to just over 4% who were SLT users.⁶⁶⁷²

India has the second highest number of oral cancer cases globally, accounting for a third of the total.⁷⁴ More than 90% of India’s oral cancer cases are caused by tobacco use and of these, more than half are caused by SLT.⁷⁵ The poor and less educated are worst affected, with much higher SLT use prevalence amongst these sections of the population.⁷⁵ There were also over a million deaths attributable to smoking in 2019, accounting for nearly 11% of all mortality in India that year.⁷⁶

A 2020 study put the economic cost of all illness and death attributable to tobacco use between 2017 and 2018 for those over 35 years of age at US$27.5 billion.⁷⁷ Smoking accounted for 74% of this cost; smokeless tobacco 26%.⁷⁷ Direct medical costs alone amounted to 5.3% of all health expenditure.⁷⁷ However, the excise tax revenue from tobacco the previous year was just 12.2% of its economic cost.⁷⁷ In simple terms, the economic burden of tobacco use is more than eight times the value of revenue the Indian government receives in excise from tobacco products.⁷⁷ This economic burden accounts for over 1% of India’s GDP.⁷⁷

Tobacco in India

Market share and leading brands

The Indian cigarette market is dominated by four companies:  ITC Limited, Godfrey Phillips India Limited (GPI), VST Industries Ltd., and Philip Morris International (PMI), which together accounted for 98% of sales in 2022.²⁶

India banned foreign direct investment in tobacco manufacturing in 2010, which means that the transnational tobacco companies (TTCs) can only access the Indian market via shareholdings and licensing agreements with local producers.⁷⁸⁷⁹

ITC Limited

ITC Limited (formerly India Tobacco Company Limited), dominates the Indian tobacco market, with a share of over 73% in 2022.²⁶ Its largest shareholder is British American Tobacco (BAT), which held just under 30% of shares until March 2024.⁸⁰⁸¹ The Indian state is also a major shareholder, via various state-owned insurance corporations and investment portfolios.⁸¹ Its products include India’s three bestselling brands of cigarettes: Gold Flake, Wills and Scissors.³¹

In a presentation to investors in June 2023, BAT CEO Tadeu Marroco stressed the importance of the company retaining at least a 25% shareholding in ITC, given that this provides BAT with seats on the ITC board and the right to veto company resolutions.⁸² Marroco also highlighted the potential of the vast Indian market in terms of newer nicotine and tobacco products, particularly oral products such as nicotine pouches.⁸² In March 2024, BAT reduced its holdings in ITC to 25.5%.⁸³For more details see ITC Limited.

Godfrey Phillips India Limited (GPI)

GPI had a market share of almost 10% in 2022, the second largest after ITC.²⁶ PMI is the second-largest shareholder with a stake of just over 25%.⁸⁴ Major brands include Four Square, Cavenders and Tipper.³¹

VST Industries Ltd

VST, formerly Vazir Sultan Tobacco Company, had a market share of over 9% in 2022, the third largest.²⁶ With a stake of over 32%, BAT is its largest shareholder.⁸⁵ Its major brands include Total, Charms and Charminar.³¹

TTCs’ licensing agreements

PMI has a licensing agreement with GPI, under which GPI manufactures and sells the brands Marlboro and Red & White in India, though PMI retains brand ownership internationally.²⁶³¹⁸⁶ This gives PMI a 5.4% market share from a global ownership perspective.²⁶ Similarly, ITC manufactures and sells the brands Berkeley and Benson & Hedges in India, though Japan Tobacco International and British American Tobacco are the global owners, respectively.²⁶³¹ Both companies have a market share of less than 2%.²⁶

• For more information on the tobacco industry in India, please see the Tobacco Supply Chain Database.

Smokeless tobacco and bidis

The Indian smokeless tobacco industry is based largely on small scale, rural production, for which accurate data is not available.⁸⁷ Local manufacturers account for significant segments of the market in several regions of India.⁸⁷ Similarly, bidi production depends largely on small home-based manufacturing operations and accurate data is not available.⁸⁷

At the national level, the biggest companies in the chewing tobacco/gutkha (see section “Undermining the gutkha ban”) market are believed to be Dhariwal Industries, Dharampal Satyapal (DS Group) and Som Sugandh Industries, which together accounted for around a quarter of sales in 2010.⁸⁷ There is also interest from the big cigarette companies in smokeless tobacco; Godfrey Phillips launched its own range of chewing products in 2010.⁸⁸ A 2021 paper found that 93% of SLT products bought in India were non-compliant with packaging regulations: either they did not have graphic health warnings, or the warnings were too small.⁸⁹

Tobacco farming

India is the world’s second biggest tobacco producer after China, producing over 766,000 tonnes of leaf in 2020.⁹⁰ This accounts for 9% of all global production.⁶⁹ Though tobacco production in India has increased significantly in recent decades – from 438,500 tonnes in 1980 – it has fallen slightly from a high of 830,000 tonnes in 2011.⁹¹

Child labour

Indian bidis feature on the U.S. Department of Labor’s 2022 List of Goods Produced by Child Labor or Forced Labor.⁹² While information on child labour in the bidi industry is not widely available, a study published in 2009 found that more than 1.7 million children worked rolling bidis in India.⁹³ This disproportionately affects girls, who are often drawn into the industry to support their families. Bidi rollers may work 10 to 14-hour days to produce over 1,000 bidis, in what a BBC report from 2012 described as “slave-like working conditions”.⁹³

Tobacco and the economy

India is the world’s second largest exporter of tobacco leaf, after Brazil.⁶⁹ According to UN Comtrade, India exported nearly US$816 million in raw tobacco in 2022, compared to nearly $21 million in imports.⁹⁴⁹⁵ Export figures for 2021-2022 from the Indian Brand Equity Foundation (IBEF) – a trust established by the Indian Department of Commerce – were slightly higher, at US$842 million.⁶⁹

India exports tobacco to more than 115 countries around the world, the biggest recipient of which is Belgium, which accounts for around 18% of India’s total tobacco exports. Other major export destinations for Indian tobacco include the United Arab Emirates, Singapore and the United States.⁶⁹

India is also a major net exporter of cigarettes. According to UN Comtrade, it exported over US$100 million in cigarettes in 2022, compared to nearly $26 million in imports.⁹⁶⁹⁷

According to IBEF, the tobacco industry in India employs about 36 million people in farming, processing, manufacturing and export activities.⁶⁹

Illicit trade

The Tobacco Institute of India, an industry body established by ITC, GPI and VST in 1992, puts the scale of the illicit tobacco trade at a quarter of the market.⁹⁸ However, independent studies put that figure much lower, at around 3% to 6%.⁹⁹ This makes illicit trade in India relatively small by global standards.¹⁰⁰ A 2018 study, which found that 2.73% of the empty cigarette packs collected in India were illicit, noted significant differences across the country.¹⁰¹ Areas with greater illicit trade penetration are often targeted by studies funded by the tobacco industry to exaggerate overall levels of illicit trade.¹⁰²

Studies have also cast doubt on industry claims that tobacco tax increases have led to expansion of illicit trade. For example, according to ITC, tax increases during the period 2012 to 2017 resulted in rapid growth of illicit trade, making India the fourth largest illicit market globally.¹⁰³ However, a study published in 2020 by experts from the WHO and the Indian government put the illicit cigarette trade at 6% of the market in 2016-17 – an increase of just 0.9% from 2009-10.¹⁰⁰

Similarly, a joint report published in 2017 by the accountancy firm KPMG and the Federation of Indian Chambers of Commerce and Industry (FICCI) argued that illicit trade – driven in part by higher taxes on cigarettes – was providing funds for terrorism and organized crime.¹⁰⁴ However, both ITC and GPI are members of FICCI, which has a history of opposing tobacco control measures in India (see Influencing policy: graphic health warnings). Similarly, KPMG has strong ties with the tobacco industry going back decades, and its work on illicit trade has been strongly criticised elsewhere. Critics argue that KPMG’s research has exaggerated the scale of illicit trade and has been used to oppose tobacco control regulations such as plain packaging.

• For more information, please see STOP’s database of Tobacco Industry Allies.

Tobacco and the environment

A 2018 study estimated that in order to produce 100 billion cigarettes, nearly 67,500 tonnes of CO₂ equivalent were emitted in India in 2010 – the equivalent of 14,544 petrol-powered vehicles driven for a year.¹⁰⁵¹⁰⁶ The industry has also been a major cause of deforestation: it is estimated that 680 square kilometres of scrub forest were destroyed and degraded for tobacco curing and the manufacture of cigarettes and other smoking consumables between 1962 and 2002.¹⁰⁷

A 2022 study estimated that 170,000 tonnes of waste is produced by the packaging of tobacco products annually in India, two-thirds of which correspond to smokeless tobacco (SLT) products.¹⁰⁸ Analysis of segregated waste revealed that 73,500 tonnes of plastic, 6,100 tonnes of foil and 1,350 tonnes of used filters are discharged annually into the environment.¹⁰⁸ Cleaning up this waste costs Indian taxpayers roughly US$766 million every year.¹⁰⁹

• For more information on the tobacco industry in India, please see the Tobacco Supply Chain Database.

Roadmap to Tobacco Control

India was the eighth country to ratify the WHO Framework Convention on Tobacco Control (WHO FCTC) in 2004.¹¹⁰ It ratified the Protocol to Eliminate Illicit Trade in Tobacco Products in 2018.¹¹¹¹¹²

The Cigarettes and Other Tobacco Products Act (COTPA), passed in 2003, is the main comprehensive tobacco control law in India. Amongst other provisions, it banned smoking in most public places, prohibited the advertising of cigarettes and other tobacco products, and banned sales to anyone under the age of 18.¹¹³ Since then, a number of rules have been introduced to aid implementation of COTPA and provide definitions.⁶⁵ In 2007-08, the government launched the National Tobacco Control Programme (NTCP), which aimed to reinforce COTPA and facilitate implementation of the tobacco control strategies contained within the WHO FCTC.¹¹⁴

In 2020, an amendment to COTPA was drafted by the Ministry of Health.¹¹⁵ Aiming to further strengthen the original legislation and boost compliance with WHO FCTC, it will abolish designated smoking areas, prohibit the sale of individual cigarettes (single sticks), and raise the legal age required for purchase of tobacco products from 18 to 21.¹¹⁵¹¹⁶ However, as of September 2023, this amendment has yet to become law.

Citing concerns about the health impacts of vaping on young people, the Indian government introduced a ban on electronic cigarettes in 2019. The law prohibits the production, manufacture, import, export, transport, sale, distribution, storage and advertisement of e-cigarettes.⁶⁵¹¹⁷ Though their use remains rare in India as of 2023, the law closes off a huge potential market for e-cigarette companies.¹¹⁸

For more details, please see the following websites:

• Legislation by country – India, Tobacco Control Laws, Campaign for Tobacco Free Kids
• India, WHO FCTC Implementation Database, WHO FCTC Secretariat
• Country profile – India, World Health Organization, WHO report on the global tobacco epidemic 2021

Tobacco Industry Interference in India

Tobacco industry tactics in India include mobilisation of front groups and third parties; litigation against tobacco control measures, such as graphic health warnings; and corporate social responsibility, including in partnership with government.

Delaying rollout of larger graphic health warnings

In October 2014, the Indian Ministry of Health and Family Welfare announced its intention to increase the area covered by graphic health warnings (GHWs) on tobacco products, from 40% to 85%.¹¹⁹ GHWs are a well-established, evidence-based and cost-effective measure of reducing tobacco use.¹²⁰ They may also be particularly effective in India, given both the country’s linguistic diversity and its literacy rate (as of 2018, over a quarter of the population was unable to read or write).¹²¹¹²²

The tobacco industry deployed various tactics in an attempt to block this legislation. These included mobilising third parties and front groups, spreading misleading information, and submitting more than 30 legal challenges in state-level courts throughout India.¹²³¹²⁴

Third parties and front groups which mobilised against the legislation included the following:

• The All India Bidi Federation
• The Tobacco Institute of India
• The Confederation of Indian Industry (CII)
• The Federation of Indian Chambers of Commerce and Industry (FICCI)
• The Associated Chambers of Commerce and Industry of India (ASSOCHAM)
• The Federation of All India Farmer Associations (FAIFA)
• The Retailers Association of India (RAI)
• The International Tobacco Growers Association (ITGA)

These groups wrote letters to and met with policy makers, launched campaigns in the media against the proposal, and filed legal challenges.¹²³¹²⁴

For example, FAIFA bought full-page advertisements in leading national newspapers, claiming that larger GHWs would be detrimental to the livelihoods of tobacco farmers and fuel the illicit trade.¹²³¹²⁵ FAIFA, CII and FICCI all wrote letters to the Minister of Health, J.P. Nadda, echoing these arguments.¹²⁶¹²⁷ The Tobacco Institute of India filed a legal challenge against the government in the High Court of Karnataka.¹²⁸ Finally, ASSOCHAM addressed a communiqué to the government, stating that the GHWs would endanger the livelihoods of more than 45 million people and lead to a flood of illicit imports.¹²⁹

These industry strategies succeeded in delaying the rollout of the 85% GHWs for a year, from April 2015 until April 2016.¹³⁰ However, the legal challenges continued even after implementation. In 2017, the High Court of Karnataka ruled that India should revert to the pre-2016 40% warnings. This decision was overruled in 2018 by the Indian Supreme Court and the 85% warnings have remained in force ever since.¹²⁴

The eventual introduction of the 85% GHWs saw India jump from 136^th to third position in the global ranking for size of health warnings on tobacco products.¹³¹

Undermining the gutkha ban

Gutkha, one of India’s most popular smokeless tobacco (SLT) products, is a mix of crushed Areca nut (a well-known risk factor for several cancers even when consumed without tobacco), with tobacco, catechu, paraffin, slaked lime and flavourings.¹³²¹³³ Highly addictive and very cheap, gutkha is popular amongst women and young people.¹³⁴

Since 2012, there have been state-level bans throughout the country in an attempt to reduce its prevalence, but it remains widely available.¹³⁵¹³⁶ Producers have found ways to circumvent the bans, such as by packaging and selling the constituent ingredients of gutkha separately.¹³⁶¹³⁷

In the state of Tamil Nadu, gutkha remained widely available despite being banned in 2013.¹³⁸¹³⁹ In 2016, officials from India’s Income Tax Department discovered details of a series of suspected bribes worth nearly US$6 million made by leading manufacturer MDM to public officials, allegedly to facilitate the storage, transport and sale of gutkha.^123138140

Alleged recipients of bribes included a government minister, police officers and senior civil servants.¹⁴¹ In November 2022, after four years of investigations in three states, India’s Central Bureau of Investigation filed charges against 21 individuals.¹⁴¹¹³⁸

Corporate social responsibility: partnerships with government

Tobacco companies often use corporate social responsibility (CSR) initiatives to enhance their public image and corporate reputation.

In the implementation guidelines for Article 5.3 of the WHO FCTC, the WHO states that these activities fall within its definition of tobacco advertising, promotion and sponsorship – and should therefore not be endorsed by Parties to the treaty.¹⁴² However, in India, under the Companies Act 2013, all large corporations are required to spend at least 2% of their average net profit in the previous three years on CSR.¹⁴³ This helps to legitimise tobacco industry CSR, as companies argue they are only fulfilling their legal duties.⁶⁷In its sustainability reporting, ITC states that its CSR initiatives fall within the scope of the 2013 legislation.¹⁴⁴

ITC has contributed frequently to government programmes and has worked with government institutions.⁶⁷ For example, in 2017, ITC contributed to a fund set up by the Indian government to attract funding from corporations and private donors for the provision of sanitation and clean drinking water; and to the Clean Ganga Fund, established by the government to rehabilitate the River Ganges.¹⁴⁴ In his speech to shareholders at the 2017 AGM, the then ITC CEO cited several public-private partnerships with state governments in India on water management projects, stating that they aligned with a national programme which aimed to expand irrigation coverage and improve efficiency of water use.¹⁴⁵¹⁴⁶

This type of public-private CSR was particularly widespread during the COVID-19 pandemic. In total, between March and June 2020, the Indian tobacco industry contributed around US$36.7 million in donations to various government funds, both at federal and state level.¹⁴³ The industry also partnered with other stakeholders, including NGOs, other private sector actors and even popular Bollywood singers. ITC was the biggest cash and in-kind contributor.¹⁴³¹⁴⁷

Corporate trademarks were widely visible during these CSR activities, and the initiatives were publicised in leading newspapers and by senior politicians.^143148149

• For more on tobacco industry activity during the pandemic, please see the COVID-19 Tobacco Tactics page and the COVID-19 monitoring database.

Relevant Links

• Global Adult Tobacco Survey GATS 2 India 2016-17, Tata Institute of Social Sciences (TISS), Mumbai and Ministry of Health and Family Welfare, Government of India
• Report on Tobacco Industry Interference in India – Case Studies, S. Goel, S. Sekhar Kar, Resource Centre for Tobacco Control
• Interference by Big Tobacco and Affiliates in Tobacco Control in South Asia, Institute of Public Health Bengaluru and the International Union Against Tuberculosis and Lung Disease
• Crooked Nine: Nine Ways the Tobacco Industry Undermines Health Policy, Vital Strategies
• National Report: The Environmental Burden of Tobacco Products Wastes in India. Tobacco Use Makes You Ugly, Your Habitat Uglier, SPH AIIMS Jodhpur, ICMR-NICPR, The Union

Tobacco Tactics Resources

• Associated Chambers of Commerce and Industry of India (ASSOCHAM)
• Federation of Indian Chambers of Commerce and Industry (FICCI)
• ITC Limited

TCRG Research

• Advancing whole-of-government approaches to tobacco control: Article 5.3 and the challenge of policy coordination in Bangladesh, Ethiopia, India and Uganda. R.A. Barry, S.M. Abdullah, A. Chugh, S. Hirpa, P. Kumar, D. Male, R. Ralston, T. Wagner-Rizvi, J. Collin, Tobacco Control 2022;31:s46-s52.
• Institutional tensions, corporate social responsibility and district-level governance of tobacco industry interference: analysing challenges in local implementation of Article 5.3 measures in Karnataka, India. P. Kumar, R.A. Barry, M.M. Kulkarni, V.G. Kamath, R. Ralston, J. Collin, Tobacco Control 2022;31:s26-s32.
• Developing more detailed taxonomies of tobacco industry political activity in low-income and middle-income countries: qualitative evidence from eight countries, B.K. Matthes, K. Lauber, M. Zatoński, L. Robertson, A.B. Gilmore, BMJ Global Health 2021;6:e004096.

For a comprehensive list of all TCRG publications, including research that evaluates the impact of public health policy, go to TCRG publications.

References

The post India Country Profile appeared first on TobaccoTactics.

Image source: eltpics/CC BY-NC 2.0

Key Points

• Viet Nam is a country located in South East Asia, part of the World Health Organization’s regional office for the Western Pacific (WPRO).
• It has a population of 98.2 million, with tobacco use prevalence of 24.9%.
• Viet Nam ratified the World Health Organization Framework Convention on Tobacco Control (WHO FCTC) in 2004. It has not joined the Protocol to Eliminate Illicit Trade in Tobacco Products.
• The Vietnam National Tobacco Corporation (Vinataba), a state-owned company, has the largest share of the national cigarette market, at nearly 58% in 2022.
• Of the transnational tobacco companies (TTCs), British American Tobacco (BAT) has by far the largest share of the market in Viet Nam, with Imperial Brands in second place. Philip Morris International (PMI), Japan Tobacco International (JTI) and others have smaller market shares.
• The tobacco industry has deployed a range of tactics to protect its interests in Viet Nam, including lobbying policy makers, use of third parties, complicity in the illicit trade in tobacco products, and spreading misleading information.

Although Viet Nam has made significant progress on tobacco control in recent years, it continues to face major challenges. Tobacco prevalence amongst men remains very high.⁶⁶ There is ongoing industry influence on policymaking, particularly on issues such as price and tax of tobacco products.¹⁵⁰ The state-owned company Vinataba enjoys special privileges from the Vietnamese state, and has long claimed a position as an affected stakeholder on matters of tobacco control.¹⁵¹¹⁵² There has also been interaction between the transnational tobacco companies (TTCs) and the Vietnamese state, including during the Conference of the Parties (COP) to the WHO FCTC.¹⁵³

Tobacco Use in Viet Nam

In 2022, the population of Viet Nam was 98.2 million.¹⁵⁴ According to a WHO age-standardised prevalence estimate, based on all national survey data between 1990 and 2019, overall prevalence of current tobacco use was just over 25%.⁶⁶ There is a major gender difference, with current male tobacco use at over 48%, compared to just over 2% for females.⁶⁶ Smoking has been an important aspect of social behaviour amongst Vietnamese men for many decades; offering cigarettes is considered to be a show of good manners.¹⁵⁰

As of 2019, less than 3% of adolescents aged 13 to 17 were current tobacco users (i.e. they had either smoked cigarettes or used waterpipe on at least one day of the 30 days prior to the survey).¹⁵⁵

In the Global Adult Tobacco Survey (GATS) 2015, overall prevalence for traditional bamboo waterpipe was 6.7%. This was higher for people aged between 45-64 (8.9%) and those living in rural areas (8.3%).¹⁵⁶ Smoke from Vietnamese waterpipes tends to have very high nicotine content: the tobacco typically used is Nicotiana rustica, known locally as thuốc lào, which can contain up to 9% nicotine compared to 1-3% in standard tobacco leaves.¹⁵⁷

There were an estimated 97,100 deaths attributable to smoking in 2019.¹⁵⁸ This means that smoking accounted for over 15% of mortality in the country for that year.¹⁵⁸ In 2011, the last year for which figures are available, the cost of tobacco use to the Vietnamese economy was estimated at nearly US$1.2 billion.¹⁵⁹ This was almost 1% of national GDP that year and around US$425 million more than the tax revenue the government received from the industry.¹⁵⁹

A 2022 study suggested that use and awareness of e-cigarettes in Viet Nam is relatively low.¹⁶⁰ However, the Vietnamese market for newer nicotine and tobacco products is expanding. According to market analysis by Statista, in 2022 the e-cigarette market was worth around US$22 million, up from US$7.7 million in 2014, and projected to reach US$24.7 million by 2027.¹⁶¹ Research conducted in June 2020 indicated that e-cigarettes were being sold mainly by speciality retailers and most of the brands available were Chinese imports. Brands popular in Western countries – such as BAT’s Vuse, Imperial Brands’ Blu and JUUL – were rare.¹⁶²

According to Tobacco Control Laws – an archive of global tobacco control legislation maintained by the Campaign for Tobacco-Free Kids – as of May 2023, there were no restrictions on use; advertising, promotion and sponsorship; or packaging and labelling of e-cigarettes.¹⁶¹¹⁶³ This lack of regulation, combined with Viet Nam’s relatively large population and high tobacco prevalence, make it an extremely attractive target for transnationals selling e-cigarettes and other newer nicotine and tobacco products.¹⁶³¹⁶²

Tobacco in Viet Nam

Market share and leading brands

In 2022, market research company Euromonitor International estimated the Vietnamese tobacco industry to be worth VND₫104,094.9 billion – approximately US$4.4 billion.¹⁶⁴ The state-owned Vietnam National Tobacco Corporation (Vinataba) has the largest market share, accounting for nearly 58% of the cigarette market in 2022.²⁶ Vinataba’s range of brands includes Vinataba, Viet Nam’s most popular cigarette.³¹ Established in 1985, Vinataba has long enjoyed special privileges and recognition from the Vietnamese government.¹⁵¹ In addition, the government retains the right to appoint Vinataba’s chair and CEO.¹⁵²

Transnational tobacco companies (TTCs) producing and distributing tobacco products in Viet Nam are required to establish joint ventures with Vinataba.¹⁵² Amongst the TTCs, British American Tobacco (BAT) has by far the largest market share, accounting for nearly 29% of the cigarette market in 2022.²⁶ BAT has more than doubled its share of the market since 2001, and dominates the mid-range and premium market sectors with brands such as Craven A, White Horse and State Express 555.^31165166 Imperial Brands has a market share of 7% with one brand, Bastos. Similarly, Philip Morris International (PMI) has a share of 3% with one brand, Marlboro. The remaining companies account for another 3.5% of the market.²⁶³¹

• For more information on the tobacco industry in Viet Nam, see the Tobacco Supply Chain Database.

Tobacco farming and child labour

From 2000 to 2020, the area of land dedicated to growing tobacco in Viet Nam fell by nearly 49%.¹⁶⁷ However, crop yield per hectare has more than doubled, meaning that in 2020 Viet Nam produced over 29,000 tonnes of tobacco leaf – around 200 tonnes more than in 2000.¹⁶⁷ Nonetheless, this is a steep drop from 2010, when Viet Nam harvested 56,530 tonnes of tobacco from an area of 31,484 hectares.¹⁶⁷

Viet Nam’s most recent National Child Labour Survey, conducted in 2018, identified more than a million children in a situation of child labour.¹⁶⁸ Of these, more than half were working in the agriculture sector – though the report does not mention tobacco growing specifically.¹⁶⁸ However, Vietnamese tobacco was one of the products identified in 2022 by the U.S. Department of Labor as having been produced by child labour, in violation of international standards.¹⁶⁹

• For information on tobacco industry responses to accusations of complicity in child labour, please see the pages on CSR: Child Labour and the Eliminating Child Labour in Tobacco-Growing Foundation (ECLT).

Tobacco and the economy

Viet Nam is a net importer of tobacco leaf. According to UN Comtrade, in 2021, it imported US$242 million in unmanufactured tobacco, compared to just over US$9 million in exports.¹⁷⁰¹⁷¹ Comtrade data also states that Viet Nam is a net exporter of cigarettes: US$182 million in 2020, compared to just over US$63,000 in imports.¹⁷²¹⁷³

However, these figures differ significantly from customs declarations found on Datamyne, which suggest that Viet Nam is a net importer of cigarettes. According to Datamyne, the value of Vietnamese cigarette imports in 2020 was nearly US$537 million, compared to exports of nearly US$270 million.¹⁷⁴ The import and export figures for raw tobacco are also different: according to Datamyne, Viet Nam imported close to US$337 million in raw tobacco in 2021, compared to around US$17.6 million in exports.¹⁷⁴

Illicit trade

According to the Vietnamese government, 54.7 million packs of illicit cigarettes were seized between 2013 and 2018.¹⁷⁵ It estimates that the illicit tobacco trade accounts for 15% of the national market.¹⁷⁵ This is roughly consistent with research conducted in late 2017 by the Development and Policies Research Center, which concluded that illicit cigarettes accounted for nearly 14% of total cigarette consumption in Viet Nam.¹⁷⁶

By far the most popular illicitly traded cigarettes in Viet Nam are the brands Jet and Hero, which together account for around 85% of the illicit market. Both are manufactured by the Indonesian company Sumatra Tobacco Trading Company and then smuggled to Viet Nam.¹⁷⁷¹⁵⁰ Both Jet and Hero sell for significantly higher prices – between 30% and 60% – than the average legal brand of cigarettes in Viet Nam.¹⁵⁰

• For more information on the tobacco industry in Viet Nam, please see the Tobacco Supply Chain Database.

Roadmap to Tobacco Control

Viet Nam ratified the World Health Organization Framework Convention on Tobacco Control (WHO FCTC) in 2004.¹⁷⁸ However, it has not yet joined the Protocol to Eliminate Illicit Trade in Tobacco Products.

The main tobacco control law in Viet Nam is the Law on Prevention and Control of Tobacco Harm, passed in 2012. It is the country’s first ever comprehensive tobacco control law and a major public health milestone.¹⁷⁹ It established smokefree spaces; increased the size of graphic health warnings on tobacco products; restricted tobacco advertising, promotion and sponsorship; and set up the Tobacco Control Fund, a sustainable source of funding for tobacco control initiatives paid for by a dedicated tax on tobacco.¹⁷⁹¹⁸⁰ More than ten subsequent decisions, decrees and joint circulars have built on this law and further strengthened tobacco control.¹⁸¹ This includes the National Strategy on Tobacco Harm Prevention and Control, which set specific targets to reduce tobacco use prevalence from 2013 to 2020.¹⁸²

For more details, please see the following websites:

• Legislation by country – Viet Nam, Tobacco Control Laws, Campaign for Tobacco Free Kids
• Viet Nam, WHO FCTC Implementation Database, WHO FCTC Secretariat
• Country profile – Viet Nam, World Health Organization, WHO report on the global tobacco epidemic 2021

Tobacco Industry Interference in Viet Nam

Tobacco industry tactics used in Viet Nam include lobbying policy makers, use of third parties, complicity in the illicit trade in tobacco products, and spreading misleading information.

Influencing policy

For the Southeast Asia Tobacco Control Alliance (SEATCA), the Vietnamese state’s majority ownership of Vinataba clashes with its duty to regulate the tobacco industry.¹⁵² Vinataba has long claimed a position as an affected stakeholder on tobacco regulation, allowing it a seat at the table in discussions on issues such as taxation and illicit trade.¹⁵²

There has also been some exchange of personnel between the government and Vinataba, with high-ranking executives at Vinataba appointed to powerful positions in government – particularly at the Ministry of Industry and Trade (MOIT) – and vice-versa. Several senior officials left government to subsequently assume roles in Vinataba.¹⁸³ Vinataba’s General Director (as of August 2023) was formerly deputy director of the Department of Light Industry, which is controlled by the MOIT.¹⁸⁴ Vinataba’s Secretary of the Party Committee and Chairman of the Member’s Council is a former vice director of the Industrial Policy and Strategy Institute, a government entity.¹⁸⁴

Vinataba’s influence is most obvious when it comes to price and tax. Cigarettes in Viet Nam are among the cheapest in the world: as of 2020, the price of a 20-pack – even of a premium brand – was less than one U.S. dollar.⁶⁶ In 2021, taxes accounted for under 39% of the retail price of the most popular brand of cigarettes – well short of the 75% recommended by the WHO.⁶⁶ Research by the World Bank has concluded that Viet Nam’s tobacco taxation policies have made cigarettes more affordable. Per capita income in Viet Nam has risen considerably in recent decades, outpacing the increase in the price of cigarettes, and increases in tobacco taxes have not been sufficient to close the gap.¹⁵⁰

In 2017, the Ministry of Finance proposed switching to a mixed excise tax system, with a flat rate of VND₫1,000 – around four U.S. cents – imposed on top of the usual ad valorem tax on the factory price of tobacco products.¹⁵⁰ This would have made little difference to the affordability of cigarettes; health officials had argued for increase of between VND₫2,000 and VND₫5,000.¹⁵⁰ Vinataba, along with the Vietnam Tobacco Association, opposed the move, claiming it would lead to difficulties in tobacco production and business operations and increase the risk of smuggling.¹⁵⁰ At the time of writing, Viet Nam had yet to introduce the mixed tax regime.¹⁸⁵

The industry has also lobbied for the diversion of funding away from the Tobacco Control Fund – which is supposed to be used for public health purposes – and towards combatting illicit trade. Vinataba has made requests of this nature to various ministries and local governments.¹⁵² In 2017, the International Union Against Tuberculosis and Lung Disease (The Union) sent a letter to the U.S. Ambassador in Viet Nam, urging him to reconsider the Embassy’s facilitation of meetings between Philip Morris International (PMI) and Vietnamese government ministers, on the grounds that PMI would attempt to raise fears over illicit trade and seek diversion of funds away from the Tobacco Control Fund and towards anti-smuggling measures.¹⁸⁶ SEATCA reported the same year that the MOIT had endorsed a recommendation from the tobacco industry to divert half of the Tobacco Control Fund towards enforcement activities against illicit trade.¹⁸⁷

The tobacco industry has also interacted with the Vietnamese delegation to the Conference of the Parties to the WHO FCTC.¹⁵³ During COP6, held in Moscow in October 2014, PMI executives met with the Vietnamese delegation. Analysis of the delegation’s interventions by tobacco control groups observing the COP showed that they frequently mirrored positions held by PMI.¹⁵³ For example, they argued that higher tobacco taxes would fuel the illicit trade and that the FCTC should be excluded from trade disputes, as well as opposing uniform parameters on legal liability for tobacco companies.¹⁵³ Likewise, at COP7, held in Delhi in November 2016, PMI held meetings with members of the Vietnamese delegation away from the conference venue.¹⁵³

Use of third parties

In June 2020 the R Street Institute, an American public policy thinktank, sent a letter to the Vietnamese prime minister and deputy prime minister urging them “to consider pragmatic regulations that allow Vietnamese citizens broad access to reduced-risk products.”¹⁸⁸ It also argued that inserts in cigarette packets should be permitted in order to market such products to current smokers; that it should be possible to place “relative-risk labels” on these products; and that maximum nicotine levels should be high enough “to achieve nicotine delivery similar to combustible cigarettes”.¹⁸⁸

Endorsing the use of e-cigarettes and heated tobacco products (HTPs) as cessation tools, the letter refers specifically to IQOS – PMI’s flagship HTP brand (though PMI has also sold e-cigarettes under the IQOS brand).¹⁸⁸ From 2014 until at least 2022, R Street received funding from Altria – the primary asset of which is Philip Morris USA, the largest tobacco company in the United States.^{189190191192193}

In the same month, Factasia also sent a similar letter to the Vietnamese prime minister.¹⁸⁴ Factasia describes itself as “an independent, not-for-profit, consumer-oriented advocate for rational debate about – and sensible regulation of – the rights of adult citizens throughout the Asia-Pacific region to choose to use tobacco or other nicotine related products.”¹⁹⁴ It acknowledges receiving funding from PMI, as well as the Tobacco Vapor Electronic Cigarette Association (TVECA), an e-cigarette trade association. However, it denies acting as a mouthpiece for the tobacco industry.¹⁹⁵

Complicity in smuggling

There is evidence that the tobacco industry has smuggled its own products into Viet Nam. Internal British American Tobacco (BAT) documents from the 1990s show how BAT and its subsidiary smuggled State Express 555 (SE555) cigarettes manufactured in the UK into Viet Nam.¹⁹⁶¹⁹⁷

BAT had been attempting to establish a presence in Viet Nam since the late 1980s, though with considerable difficulty. Negotiations on the terms of a joint venture with Vinataba were extremely slow, while a ban on foreign imports in 1990 meant that BAT would either have to license a Vietnamese company to manufacture its products locally or purchase equity in a local factory.¹⁶⁵

Smuggling facilitated BAT’s entry into the Vietnamese market in two ways.¹⁶⁵ Firstly, by circumventing the import ban, BAT managed to create brand awareness amongst Vietnamese smokers and obtain a competitive advantage prior to any opening of the market.¹⁶⁵ Secondly, by highlighting loss of tax revenue due to illicit trade, BAT was able to use smuggling as leverage in its negotiations with Vinataba.¹⁶⁵ An internal BAT document from 1993 states “We have the high ground [in negotiations with Vinataba] given the excellent quality of distribution, presence, and value of the GT [i.e. smuggled] product.”¹⁹⁸

The same BAT document states that “Both versions [i.e. licit and illicit cigarettes] will have a role to play in the further building of the brand and the ‘system’ profitability”.¹⁹⁸¹⁹⁹ Indeed, BAT continued to smuggle its own products into Viet Nam even after signing an agreement in 1994 which licensed Vinataba to manufacture SE555 locally.¹⁶⁵ BAT carefully controlled the price of both the licit and illicit SE555, with the smuggled cigarettes fetching higher prices because they were perceived to be of higher quality.¹⁹⁶ BAT finally signed a US$40 million joint venture with Vinataba in 2001, for construction of a brand new leaf-processing plant in Dong Nai province.¹⁶⁵²⁰⁰ This was followed by a further agreement in 2006, under which 150 million packs per annum of Pall Mall and Viceroy would be manufactured for the domestic market, as well as another 50 million packs per annum for export.¹⁶⁵ Even then, illicit BAT products did not disappear from the Vietnamese market. As recently as 2017, illicit SE555 were still selling at 169% of the value of the licit version.¹⁷⁶

Spreading misleading information

Most existing estimates of the illicit tobacco trade in Viet Nam are based on industry data and rely on methods which are opaque, undisclosed or difficult to replicate over time.¹⁵⁰ While the government estimated in 2020 that illicit trade accounted for 15% of the national market, and independent research from 2017 put that figure at 13.72%, tobacco industry estimates are significantly higher.¹⁷⁵¹⁷⁶ Japan Tobacco International Vietnam, for example, states that “the rate of smuggled cigarettes is quite high (more than 20%) on the market”.²⁰¹

Oxford Economics (OE) put the share of total illicit consumption at 23.4% in 2017.¹⁵⁰ An economic advisory agency with links to the tobacco industry going back to the early 2010s, OE produced yearly reports on the illicit trade in Asia between 2012 and 2017 which were funded by PMI and based on PMI-approved terms of reference.^{202203204205206207}

These reports have been criticised in the strongest terms by Dr Hana Ross of the University of Cape Town, writing for the Southeast Asia Tobacco Control Alliance (SEATCA):

“The common denominator to all pieces of this study is PMI and its TORs [terms of reference] with all of the multiple parties in the report’s chain of production. This is a way for PMI to control the final results—by controlling the input, the data analysis, as well as publication, distribution, and promotion.”²⁰⁸

This exaggeration of the scale of illicit trade is a well-documented means of fighting tobacco control measures such as graphic health warnings, plain packaging and increased tobacco taxes. However, there is no evidence to show that tax increases have led to an increase in the illicit trade in Viet Nam; on the contrary, the illicit trade declined even after a 5% increase in the ad valorem tax rate in January 2016.¹⁷⁶

• For more information see Illicit Tobacco Trade

Relevant Links

• Global Adult Tobacco Survey (GATS) Viet Nam 2015, GATS Viet Nam Working Group
• Vietnam 2023 Tobacco Industry Interference Index, Global Center for Good Governance in Tobacco Control
• Vietnam 2021 Tobacco Industry Interference Index, Global Center for Good Governance in Tobacco Control
• Asian State-Owned Tobacco Enterprises: Challenges & Opportunities in Implementing WHO FCTC Article 5.3, Southeast Asia Tobacco Control Alliance (SEATCA)
• Vietnam: Overview of tobacco control legislation, use and taxation, World Bank Group
• Evidence Matrix: Vietnam, Tobacconomics
• Inside Philip Morris’ campaign to subvert the global anti-smoking treaty, A. Kalra, P. Bansal, D. Wilson, T. Lasseter, The Philip Morris Files, Reuters

Tobacco Tactics Resources

• Western Pacific Region
• Waterpipe
• Price and Tax
• Tobacco Smuggling
• Oxford Economics
• R Street Institute
• Factasia

TCRG Research

• Developing more detailed taxonomies of tobacco industry political activity in low-income and middle-income countries: qualitative evidence from eight countries, B.K. Matthes, K. Lauber, M. Zatoński, L. Robertson, A.B. Gilmore, BMJ Global Health 2021;6:e004096.
• Gaining access to Vietnam’s cigarette market: British American Tobacco’s strategy to enter ‘a huge market which will become enormous’, K. Lee, H.V. Kinh, R. Mackenzie, A.B. Gilmore, N.T. Minh & J. Collin, 2008, In: Global Public Health. 3, 1, p. 1-25.

For a comprehensive list of all TCRG publications, including research that evaluates the impact of public health policy, go to TCRG publications.

References

The post Viet Nam Country Profile appeared first on TobaccoTactics.

This is a record of significant organisations that have either partnered with PMI IMPACT on projects, or produced PMI IMPACT sponsored content.

For projects that have received PMI IMPACT funding as part of the main funding initiative, visit the List of Successful PMI IMPACT Applicants page.

Organisations

Concordia

PMI has partnered with NGO Concordia on illicit trade projects in recent years (in addition to other topics including on industry transformation, resilience, recovery, science, innovation, inclusion, and public-private partnerships):

In July 2022, a roundtable on trade-based money laundering, free trade zones, and port security featured Grégoire Verdeaux, Sr. VP of External Affairs at PMI – along with representatives from the Organization of American States, the US Department for Homeland Security, and Guatemala’s Minister of Economy. It was chaired by David Luna, Executive Director of the International Coalition Against Illicit Economies (ICAIE), who is also chairman of the OECD Task Force to Combat Illicit trade and of the Business at OECD taskforce on illicit trade, co-chaired by Alvise Giustiniani, VP of Illicit Trade Prevention at PMI.²⁰⁹²¹⁰

In December 2020, PMI hosted a roundtable on combatting illicit financing in Africa as part of the 2020 Concordia Africa Initiative. The event focused on fostering public-private cooperation.²¹¹ 

El Cronista, Argentina

The Regional Summit on Security and Illicit Trade was hosted by Argentinian newspaper El Cronista in partnership with PMI IMPACT in June 2019.²¹² It featured PMI IMPACT Expert Council members, PMI impact grantees (e.g. Freeland Foundation), and organizations with links to the tobacco industry, including Crime Stoppers and the US Chamber of Commerce of Costa Rica.²¹³

The Economist, UK

Though it is unclear how many of these initiatives were funded through PMI IMPACT as such, PMI has sponsored a large number of publications and events put together by the Economist on the illicit trade in recent years. These include:

• An October 2018 conference on fighting against illicit trade hosted by the US Chamber of Commerce in Tunisia, in collaboration the Economist and TRACIT.²¹⁴
• A January 2020 event held in Davos and entitled “Confronting global challenges: Solidarity in an era of retreat”, whose speakers included the VP of the European Investment Bank, the heads of Brookings Institution and the International Institute for Strategic Studies, and PMI’s then CEO André Calantzopoulos.²¹⁵
• A virtual webinar entitled “Illicit trade in a post-pandemic world: Learning from disruption” held in December 2020. Speakers included senior representatives from Europol, the OECD Task Force on Countering Illicit Trade, Alvise Giustiniani (VP, Illicit Trade Prevention, at PMI), and Carlos Moreira (Member, PMI IMPACT Expert Council).²¹⁶
• A December 2020 briefing paper by the Economist Intelligence Unit entitled “Unintended consequences, unexpected benefits: Technology, crime and illicit trade”. The authors noted in conclusion: “Without trust, meaningful cooperation between governments and the private sector, or between law enforcement and citizens, will never materialise.”²¹⁷
• A panel discussion, as part of the Global Trade Week in June 2021, entitled “Countering the counterfeits in e-commerce”, featuring Alvise Giustiniani (VP, Illicit Trade Prevention at PMI), and David Luna (chairman of the OECD Task Force to Combat Illicit trade and of the Business at OECD taskforce on illicit trade, which is co-chaired by Giustiniani)²¹⁸
• A virtual webinar held in December 2021 on the “Continental shift: Tackling illicit trade in Europe”, where speakers included PMI’s Giustiniani and Stefano Betti of TRACIT.²¹⁹ Publications listed as resources for the event were all from or linked to the tobacco industry: PMI/The Economist, TRACIT, and KPMG.
• A 2021 policy brief by the Economist Intelligence Unit entitled “Lasting effects: How the COVID-19 pandemic will change illicit trade”, which noted that “the usual loose grouping of malicious opportunists is exploiting new vulnerabilities: individual criminals, organised crime networks and international terrorist organisations.”²²⁰ The report fails to discuss how the tobacco industry was also able to capitalise on the COVID-19 pandemic.
• A November 2022 event entitled “Crunch point: Illicit trade amid economic crises”, which notably tackled “how policymakers can craft new legislation, and repurpose existing regulations to curb illicit trade” and whose speakers included Till Mansmann MP, Member of the German Bundestag and Innovation commissioner for green hydrogen, German Federal Ministry of Education and Research, Stefano Betti, Deputy director-general of TRACIT, and Rishaad Hajee, Head of global communications at PMI.²²¹

Financial Times, UK

In September 2017, PMI IMPACT and the Financial Times held a joint event titled Combating Illicit Trade: Progress, Challenges and Collaborative Solutions.²²² The conference included panel discussions, dialogues, presentations, and interviews, including talks about the projects selected as part of PMI IMPACT’s first funding round, and a speech by PMI’s Chief Executive Officer at the time, André Calantzopoulos.²²² Other speakers included members of PMI IMPACT’s Expert Council, academics, and representatives of the EU Commission, Europol, Her Majesty’s Revenue & Customs (HMRC), the Organization for Economic Cooperation and Developments (OECD), the World Customs Organization (WCO), the World Trade Organization (WTO), and the UNODC.²²²

MED 2019, Italy

PMI IMPACT was a knowledge partner in the 5^th edition of the Rome MED – Mediterranean Dialogues 2019 Conference, organized by the Italian Ministry of Foreign Affairs and International Cooperation and the Italian Institute for International Political Studies (ISPI). It gathered participants from 55 countries, including heads of state, ministers, and senior representatives from international organizations.²²³ One afternoon specifically tackled illicit trade, focusing on the role of terrorist and organized crime groups. Participants notably included eight PMI representatives, and representatives from the OECD, United Nations Interregional Crime and Justice Research Institute (UNICRI), the United Nations Office on Drugs and Crime (UNODC), the European External Action Service (EEAS), and the European Commission.²²⁴²²⁵

Meridian International, US

Between March 2020 and June 2021, Meridian Internatoinal, a Washington D.C.-based and self-described “nonpartisan, nonprofit diplomacy center”²²⁶ received US$100,000 from PMI IMPACT²²⁷ to partner on six events as part of Meridian’s “International Dialogues to Fight Illicit Economies” series.²²⁸ The events featured several PMI representatives, including Hernan Albamonte (Senior Manager, External Affairs and Head of Illicit Trade Prevention for the United States), Alvise Giustiniani (Vice President, Illicit Trade Prevention), Suzanne Hayden (PMI IMPACT Expert Council member), foreign diplomats (including from El Salvador, Botswana, Mexico, Spain, and Egypt), US government officials (including Department of Labour, Department of Justice, Drug Enforcement Administration, and United States Agency for International Development – USAID), and other renowned civil society groups (including Transparency International, Global Financial Integrity, and Brookings Institution). A central recurring topic and recommendation of the sessions was the need for increased engagement with the private sector.²²⁸

In October 2019 Meridian held an event in partnership with PMI on agricultural technology, which featured representatives from the US Department of Agriculture and agricultural attachés from a number of embassies (e.g. of Mozambique, Chile, Turkey), as well as J.B. Simko, head of PMI’s office in Washington, D.C. and Vice President, External Affairs.²²⁹²³⁰ In the event description on the Meridian website, PMI is described as follows: “In moving towards a smoke-free future, PMI is taking steps to transform its value chain, re-skilling farmers and other employees, sourcing raw materials in a sustainable manner and reducing their environmental footprint.”²²⁹

• For more on the tobacco industry’s greenwashing tactics, visit our Greenwashing page.
• For more on Meridian and its ties to the tobacco industry, visit our Meridian International page.

Munich Security Conference, Germany

The Conference is one of the most prominent events on security and defence issues worldwide, featuring heads of state and government from across the world, in addition to ministers, ambassadors and heads of international government organizations. PMI IMPACT has been a sponsor for several years, notably as a knowledge partner to the MSC’s Transnational Security Initiative²³¹

In 2022, Alvise Giustiniani, VP, Illicit Trade Prevention at PMI, tweeted: “With #PMIIMPACT, we’re fostering an inclusive approach for public and private actors to build innovative programs against illegal trade in its many forms. ​We’re honored to join @MunSecConf Transnational Security series”²³² Other PMI participants to the 2022 conference included Dmitry Y. Belousov (Vice President External Affairs Eastern Europe, PMI), Marco Mariotti, (President Eastern Europe, PMI).²³³ and PMI’s Senior Vice President of External Affairs Gregoire Verdeaux, who sat down with MSC’s CEO Benedikt Franke ahead of the conference to stress that “We must continue taking steps toward real cooperation between the public and private sectors” in the fight against illicit trade.²³⁴

In 2020, PMI IMPACT co-hosted an off-the-record roundtable titled ““Trading Violence: Conflict Economies in the Sahel and Beyond,” which began with on-the-record presentations from Abdalla Hamdok, Prime Minister of the Republic of the Sudan, and Michèle Coninsx, UN Assistant Secretary General and Executive Director of the Counter-Terrorism Executive Directorate.²³¹

PMI IMPACT (along with EY) was a knowledge partner on a 2019 conference publication entitled “Transnational Security Report Cooperating Across Borders: Tackling Illicit Flows”.²³⁵ One of its recommendations is to “Join forces through cross-industry and public-private partnerships where appropriate to fight illicit trade, such as the Latin American Alliance Against Smuggling, which brings together regional public and private efforts.”²³⁵

The 2018 Munich Security Conference also featured a panel on “New Strategies to Counter Trafficking”, which was hosted by PMI Impact and the Royal United Services Institute (RUSI), and which featured Julian King, then European Commissioner for the Security Union (2016-2019).²³⁶²³⁷

The American Friends of the MSC is a charitable organization aiming to “promote the activities of the Munich Security Conference in the United States of America”. Its board members include Marc S. Firestone, former President of External Affairs and General Counsel at PMI.²³⁸

NATO Defense College Foundation, Italy

The NATO Defense College Foundation, located in Rome, describes its mission as “to promote the culture of stability and well-being in the North Atlantic area and in Partner nations”.²³⁹ In December 2023, Dutch journalist Tjitske Lingsma found that since 2014, “PMI has subsidised around 25 conferences of the think tank”, which “offers the tobacco giant access to politicians, ministers and other influential people from around the world.”²⁴⁰ Recent events and reports funded by PMI include:

• A January 2016 conference and report on “Eurasia and Armed Radicalism”. Alvise Giustiniani, VP, Illicit Trade Prevention at PMI, wrote the introduction to the conference report, in which he portrays the company as a victim to illicit trade and a solution to it, and calls for “Enhanced public-private cooperation” and “An open and inclusive dialogue, bringing all actors to one table”.²⁴¹
• A June 2019 event on “NATO at 70: Refocusing for change?”, co-hosted with the Atlantic Council.²⁴² Speakers notably included former US Secretary of State Madeleine K. Albright. The Atlantic Council website did not mention PMI’s sponsorship.²⁴³
• A December 2020 event entitled “Game Changers 2020: A New Future Dawns on International Security”. Speakers included officials from NATO, the Italian Air Force Staff, as well as academics, journalists, and private sectors representatives.²⁴⁴
• A September 2020 event entitled “Balkan Perspectives 2020: The Fight for a Timely Inclusion”, also supported by the European Commission. Speakers included officials from NATO, the EU, the Organization for Security and Co-operation in Europe (OSCE), and the Norwegian, Austrian and Italian governments.²⁴⁵
• A June 2022 event on global food security and public-private partnerships.²⁴⁶
• A June 2022 conference entitled “NATO 2022: A relevant Alliance in a changing world”.²⁴⁷ In the conference report, Alfredo Antro of the “Arma dei Carabinieri” (or Carabinieri Corps – an Italian police force with a military status) noted that NAS has “established a close and fruitful cooperation with all the most important institutions and relevant actors, like Philip Morris International”. The report also features a chapter by Piergiorgio Marini, Manager, Illicit Trade Prevention, External Affairs, Philip Morris Italy, on “Managing crises in global supply chains”, which stressed how “cross-sectoral collaboration and public and private partnership are most needed”.²⁴⁷
• The “Balkan and Black Sea Perspectives 2023” conference, held in December 2023 in cooperation with the NATO Public Diplomacy Division, the NATO Defense College, Philip Morris Italy, Fondazione Compagnia di San Paolo, and MBDA Italy.²⁴⁸ Joshua Abrams, Regional Director, Eurasia Programs at the Campaign for Tobacco-Free Kids, noted on LinkedIn: “After a quick call for action among tobacco control advocates from Ukraine and around the world, all speakers affiliated with the tobacco industry were excluded from the conference”.²⁴⁹ However, the website and programme continued to acknowledge the support of Philip Morris.²⁴⁸ Previous events in this series had also been supported by PMI, e.g. in 2021.²⁵⁰

United Nations Global Compact, US

PMI has used its former membership of the UN Global Compact (UNGC) to promote PMI IMPACT and attempt to portray this association as evidence that PMI is in collaboration with the UN and supports “broader UN goals”.²⁵¹ In 2016 and 2017, when it was still a member of the UNGC, PMI published two UNGC ‘communications on progress’ reports. The first report outlined the launch of PMI IMPACT as a “catalyst for a more holistic approach against the illegal tobacco trade, corruption and organized crime” (Image 2).²⁵¹ The second report described PMI IMPACT as “a global initiative governed by independent experts to sponsor third-party initiatives”.²⁵²

Image 2. Page on PMI IMPACT, taken from PMI’s year-2015 ‘communication on progress’ for the UNGC.²⁵¹Using the association with the UNGC, is a Corporate Social Responsibility (CSR) tactic, whereby PMI tries to enhance its reputation and present themselves as a good corporate citizen, despite the harms caused by its products. In September 2017, recognizing that “tobacco products are in direct conflict with UN goals”, the UN Global Compact instituted an exclusion for companies that “produce and/or manufacture tobacco or are part of a joint venture, have a subsidiary or affiliate stake in a company that produces and/or manufactures tobacco”.²⁵³

• For more information, see (UNGC).

World Policy Conference Foundation, Switzerland

In October 2019, PMI IMPACT was listed as a partner of the twelfth edition of the World Policy Conference, held in Marrakech. The conference included a plenary session entitled “Cross-border illegal trade: a destabilizing factor for the global economy”, moderated by Alvise Giustiniani, Vice President for Illicit Trade Prevention at PMI, Carlos Moreira, PMI IMPACT Expert Council, and Jean-François Thony, President of the PMI IMPACT-funded Siracusa International Institute, who notably told the audience: “Global strategies to fight illicit trafficking cannot be developed and implemented without or against the private sector. That is why the Siracusa International Institute asks the private sector companies concerned to join this discussion and back the efforts undertaken.”²⁵⁴

Zermatt Summit Foundation, Germany

In September 2019, an Anti-Illicit Trade Declaration Calling on the International Community to Address all Forms of Illicit Trade was signed as part of the 2019 Zermatt Summit.²⁵⁵ Its signatories were representatives of²⁵⁶:

• The Zermatt Summit Foundation – dedicated to “harnessing the power of Business and Finance for the Common Good”²⁵⁷
• Sucafina SA – a coffee producer and distributor;
• The OISTE Foundation – founded by PMI IMPACT Expert Council member Carlos Moreira
• WISeKey – founded and headed by Moreira
• And PMI’s VP of Illicit Trade Prevention Alvise Giustiniani on behalf of Philip Morris Products SA

A roundtable on the illicit trade organized as part of the 2019 Zermatt Summit also featured Moreira, Giustiniani and a United Nations Industrial Development Organisation (UNIDO) representative.²⁵⁸ Moreira, Giustiniani and David Luna (chairman of the OECD Task Force to Combat Illicit trade and of the Business at OECD taskforce on illicit trade, which is co-chaired by Alvise Giustiniani) shared another panel organized by the Zermatt Summit Foundation and the OISTE foundation on 12 November 2020, entitled “Fighting illicit trade by promoting the blue economy in the age of sustainability”²⁵⁹

Tobacco Tactics Resources

PMI IMPACT

List of Successful PMI IMPACT Applicants

Philip Morris International

Concordia

Crime Stoppers International

United Nations Global Compact (UNGC)

US Chamber of Commerce

References

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