Image source: Nathan Hughes Hamilton/CC BY 2.0 DEED

Key Points

• Indonesia is a country in Southeast Asia, part of the World Health Organization’s South-East Asia Region.
• It is the fourth most populous country in the world, with a population in 2022 of 275.5 million.
• Tobacco use prevalence is high, particularly amongst men. 34.5% of all adults were current tobacco users in 2021, including 65.5% of men.
• Indonesia has neither signed nor ratified the World Health Organization Framework Convention on Tobacco Control. As a non-party, it is ineligible to join the Protocol to Eliminate Illicit Trade in Tobacco Products.
• The Indonesian tobacco market is dominated by local manufacturers PT Gudang Garam Tbk and PT Djarum, as well as Philip Morris International.
• Recent tobacco industry tactics in Indonesia include the use of third parties; the targeting of youth with tobacco marketing, both at point of sale and online, as well as via event sponsorship; and sponsorship of popular sports such as badminton and football.

According to the authors of a 2023 paper, “Indonesia has a high smoking prevalence that has not diminished significantly since 1990”. This has been driven by male smoking rates which remain amongst the highest in the world.¹² It is the only country in Asia to have neither signed nor ratified the World Health Organization Framework Convention on Tobacco Control (WHO FCTC),³ and nor is there any comparable national framework for tobacco control.¹ Industry interference in policymaking is ongoing, as there is no effective legal mechanism to prevent it.⁴⁵ Smoking has long been a part of Indonesian culture, particularly for men, something which tobacco companies have exploited through aggressive marketing tactics that aim to reinforce smoking as a normal or even essential masculine behaviour.⁵⁶ This high degree of social acceptability means that the government treats the industry as a legitimate stakeholder.⁷ One key challenge, therefore, is to de-normalise tobacco use, as part of a comprehensive tobacco control plan.⁷⁸

Tobacco Use in Indonesia

The link between smoking and masculinity is deeply embedded within Indonesian culture.⁸⁹ This has been reinforced by tobacco marketing which associates tobacco products with characteristics traditionally considered masculine, such as strength, heroism and self-control.⁸⁹

In 2021, tobacco use prevalence amongst adults was 34.5%; 70.2 million adults were current users of tobacco.¹⁰ Nearly two-thirds (65.5%) of Indonesian men reported using tobacco, compared to around 3% of women.¹⁰

In 2019, nearly 20% of students aged from 13 to 15 reported tobacco use.¹¹ Around 36% of males in this age group reported current tobacco use compared to 3.5% of females.¹¹

Kreteks – cigarettes consisting of tobacco, cloves and flavourings such as chocolate, dried fruit and coffee – are by far the most popular tobacco product in Indonesia. According to government figures from 2017, kreteks accounted for more than 95% of the cigarettes sold that year.¹² The cloves provide a unique flavour and smell, and also contain eugenol, a chemical compound which reduces the harshness of the smoke.¹³ In 2021, close to 30% of all Indonesian adults – around 60 million of the country’s 70 million adult tobacco users – reported smoking kreteks.¹⁰

There were an estimated 246,000 deaths attributable to smoking in 2019, accounting for nearly 15% of all mortality in Indonesia that year.¹⁴ Research published in 2022 estimated the total cost of smoking to the Indonesian economy in 2019 at between Rp184.36 trillion (US$13 billion) and Rp410.76 trillion (US$29 billion).¹⁵ The same study found that direct healthcare costs accounted for between Rp17.9 trillion (US$1.3 billion) and Rp27.7 trillion (US$2 billion), most of which is covered by the Social Security Agency for Health, equivalent to 57-59% of total direct expenditure on healthcare.¹⁵

Tobacco in Indonesia

Market share and leading brands

In 2022, market research company Euromonitor International put the value of the Indonesian tobacco market at over US$34 billion.¹⁶ It is the second-largest cigarette market in the world.¹⁷

The market leader in Indonesia is the local kretek manufacturer PT Gudang Garam Tbk (Gudang Garam), with nearly one-third of the market in 2022.¹⁸¹⁹

Its closest competitor is Philip Morris International (PMI), with a slightly smaller share.¹⁸ PMI operates in Indonesia via its subsidiaries PT Philip Morris Indonesia and PT HM Sampoerna Tbk (Sampoerna).¹⁸²⁰ At the time of its acquisition by PMI in 2005, Sampoerna was the leading tobacco company in Indonesia.²⁰²¹

PT Djarum (Djarum), another local kretek producer, has the third-largest market share, around half that of the two leading companies.¹⁸²²

Like PMI, other transnational tobacco companies have sought to expand into Indonesia by acquiring local companies. In 2009, British American Tobacco (BAT) bought an 85% stake in PT Bentoel Internasional Investama Tbk (Bentoel) – at the time the fourth largest tobacco company in the country.²¹ In 2011, the South Korean company Korea Tobacco & Ginseng (KT&G) – which has a partnership with PMI for its newer nicotine and tobacco products – bought a controlling share of Indonesia’s sixth-largest tobacco company, PT Trisakti Purwosari Makmur.²¹²³ Similarly, Japan Tobacco International (JTI) acquired two Gudang Garam subsidiaries, Karyadibya Mahardhika and its distributor, PT Surya Mustika Nusantara, in 2017.²¹ However, BAT, JTI and KT&G each had market shares of less than 2% as of 2022.¹⁸

In 2022, the top four brands of cigarette in Indonesia were all kreteks. Gudang Garam has around one-third of the market. Djarum, A Mild and Dji Sam Soe (the latter two both PMI/Sampoerna brands) each have around a one-tenth share. Others, including PMI’s premium cigarette Marlboro, have smaller shares.²⁴

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

Tobacco farming and child labour

Tobacco is grown in Indonesia almost entirely on small, family-run farms, and 90% of production comes from just three provinces: East Java, Central Java, and West Nusa Tenggara.²⁵

In 2021, Indonesia reported production of over 237,000 tonnes of raw tobacco, making it the fourth largest producer in the world after China, India and Brazil.²⁶ Production has varied since 2010, from a low of less than 127,000 tonnes in 2016 to a high of nearly 270,000 tonnes in 2019. However, the overall trend in recent decades has been upwards, as shown in the graph below:

Figure 1: Tobacco production, 1980 to 2021.²⁷ Source: UN Food and Agriculture Organization/Our World in Data | CC BY

The area harvested under tobacco crop also increased by over 30% between 2000 and 2020, to nearly 220,000 hectares.²⁸

A 2017 report by the World Bank found that poverty was widespread amongst tobacco farmers in Indonesia. Nearly three-quarters of tobacco farmers were poor compared to around one-tenth of the general population.²⁹ Most tobacco-farming households received some form of government social assistance, and more than 60% reported food insecurity.²⁹

Research published in 2020 found that Indonesian tobacco farmers would be better off economically if they grew other crops or pursued alternative, non-agricultural livelihoods.³⁰ Tobacco is also vulnerable to adverse weather conditions in comparison to other crops. In 2016, a period of much higher-than-average rainfall, while non-tobacco farmers made a modest income, tobacco farmers’ income was almost zero.³⁰

Tobacco-farming households had significantly higher labour costs than those growing other crops.³¹ Tobacco farmers also used child labour, both hired and household, more frequently compared to those growing other crops.³⁰ Similarly, more children from tobacco farms missed school.³⁰ Farmers reported using child labour because tobacco growing does not usually pay enough to hire adult workers.³⁰

An investigation by The Guardian in 2018 visited the village of Beleke, on the island of Lombok, where it found almost all children above the age of four doing tobacco work during harvest season.³² This followed a report by Human Rights Watch (HRW) in 2016, which stated that thousands of children work in tobacco farming in Indonesia. HRW found children engaged in dangerous work in four Indonesian provinces, interviewing more than 130. They reported serious health and safety issues, including acute nicotine poisoning as a result of handling tobacco leaves (also known as green tobacco sickness) and contact with pesticides and other chemicals.²⁵

HRW’s interviews with tobacco farmers and traders revealed a lack of human rights due diligence in the tobacco supply chain in Indonesia, particularly regarding child labour.²⁵ The farmers and traders interviewed supplied large Indonesian and transnational companies including Gudang Garam, Sampoerna, Djarum and Bentoel.²⁵

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

Tobacco and the economy

Given its high level of tobacco consumption, Indonesia has long been a net importer of tobacco leaf, despite also being a major producer.³¹ In 2022, it imported over US$617 million in raw tobacco, compared to around US$266 million in exports.³³³⁴

However, it is a net exporter of cigarettes: over US$913 million in 2022, compared to US$118 million in imports.³⁵³⁶

In 2020 the WHO reported that the contribution of the tobacco industry to the Indonesian economy was relatively small; tobacco manufacturing generates just 0.6% of total employment, while tobacco farmers represent only 1.6% of the agricultural workforce. Most families involved in tobacco growing and kretek rolling also receive some form of social assistance – meaning that the Indonesian state is essentially subsidising poorly-paid employment in the tobacco industry.³⁷

Illicit trade

A study published in 2019, which collected packs of cigarettes from respondents in Indonesia, found that 20% of the 1,440 smokers surveyed reported ever smoking illicit cigarettes. However, among the 1,201 packs researchers collected, only 20 (i.e. 1.6%) had no excise stamp, a fake excise stamp, or no graphic health warning – and hence were potentially illicit. Price appears to be a factor, with people on lower incomes more likely to purchase illicit cigarettes, though consumption of illicit cigarettes was not found to be a long-term behaviour.³⁸ However, a 2021 study estimated that the share of illicit cigarette consumption in the country increased from 5% in 2013 to 19% in 2018.³⁹

Globally, Free Trade Zones (FTZs) are well known to facilitate the illicit tobacco trade.⁴⁰ There are four FTZs in Indonesia, where cigarette production and trade are exempted from excise duties, making the price much lower. Cigarettes leak from these FTZs, becoming illicit in the process, as the packs bear no excise stamps.⁴¹ In August 2023, Indonesia’s Corruption Eradication Commission announced that a senior official from the Bintan Free Trade and Port Zone had been arrested on charges of data manipulation and receiving bribes from cigarette companies, to allow greater flows of duty-free cigarettes through the zone.⁴²

Internal industry documents suggest that historically, BAT has been involved in illicit trade in Indonesia and the broader region.⁴³ A 1994 internal BAT document points to Indonesia – along with Malaysia – as a conduit of illicit products to the Philippines.⁴⁴ A BAT-commissioned study from the 1980s also documented Indonesian consumers’ preference for its smuggled products.⁴⁵

As part of the third round of the Philip Morris International initiative PMI IMPACT, PMI is funding the Institute for Development of Economics and Finance, an Indonesian think tank, to “examine the market for NTHRPs [nicotine and tobacco harm reduction products] and how to prevent illicit trade in this growing sector, with research to include surveys and limited group discussions”.⁴⁶

• For more information on PMI IMPACT, please see the following pages: PMI IMPACT, List of Successful PMI IMPACT Applicants and Organisations linked to PMI IMPACT.

Tobacco and the environment

Indonesia is the world’s second-biggest contributor to marine plastic pollution after China, responsible for 1.29 million tonnes of debris entering the ocean annually.⁴⁷ Of this waste, cigarette butts are the most commonly-littered item.⁴⁸ The Global Center for Good Governance in Tobacco Control has estimated the cost of tobacco-related marine pollution and waste management in Indonesia at Rp49 trillion (US$3.1 billion) per year.⁴⁹

• For more information, please see the page on Tobacco and the Environment and the long read on Plastics, the Environment and the Tobacco Industry.

Roadmap to Tobacco Control

Indonesia is not a party to the WHO FCTC, and is therefore ineligible to join the Protocol to Eliminate Illicit Trade in Tobacco Products. As of 2023, there appears to be little political will either to ratify the WHO FCTC or to create a comparable national framework for tobacco control. This has led to a fragmented approach across different government departments and prevented the development of coherent tobacco control policies.¹

However, Indonesia has committed to an Association of Southeast Asian Nations (ASEAN) five-year plan on health, under which it has pledged to reaffirm collective positions against industry interference and for implementation of control measures, for both tobacco and alcohol.⁵⁰

In 2009, the passage of Law No. 36 authorised the Ministry of Health to introduce tobacco control regulation, including on tobacco advertising, promotion and sponsorship (TAPS); smoke-free spaces; and packaging and labelling of tobacco products.⁵¹ This was followed in 2012 by Indonesia’s principal tobacco control law, Government Regulation 109 (PP 109/2012).⁵¹ These laws prohibit smoking on public transport, and in educational facilities and places of worship, though other types of enclosed public spaces, including workplaces, restaurants and government facilities, may provide smoking areas.⁵²⁵³ More stringent regulations at the subnational level are permitted.⁵² As of June 2023, 456 (around 86%) of Indonesia’s 520 cities and districts had adopted smoke-free policies, though implementation remains a challenge.⁵⁴

Indonesia is one of the few countries that still permits tobacco advertising on television, though it may not be broadcast until after 9:30pm.⁵²⁵¹ While Law No. 36 and PP 109/2012 also introduced graphic health warnings (GHWs) on tobacco packaging and banned misleading terms such as “light” and “low-tar”, the law was not retroactive for tobacco products that already had these words in their branding, and other misleading features – such as colours, numbers and symbols – are still permitted.⁵²⁵¹

As of 2024, various other limitations remain. There are no restrictions on internet sales or the sale of individual cigarettes (single sticks); there is no national law regulating the sale, use, advertising, promotion, sponsorship, packaging or labelling of e-cigarettes; and tobacco industry corporate social responsibility (CSR) is still permitted.⁵¹⁵³ Cigarettes in Indonesia also remain relatively cheap. In 2022, the price of the bestselling brand of cigarettes was just over US$2.⁵³

In 2018, President Widodo issued a decree containing a list of government regulations to be revised, which included PP 109/2012.⁵⁵ Tobacco control advocates have seen this as an opportunity to push for stronger regulations, such as larger GHWs, higher excise taxes on cigarettes and a comprehensive ban on TAPS.⁵⁵ However, this process has stalled, amidst conflict between different government ministries and opposition from farmers’ associations and other groups (see section “Use of third parties”).⁵⁵ As of March 2024, the revision of PP 109/2012 had yet to advance.

For more details, please see the following websites:

• Legislation by Country/Jurisdiction – Indonesia, Tobacco Control Laws, Campaign for Tobacco-Free Kids
• Country profile – Indonesia, World Health Organization, WHO report on the global tobacco epidemic 2023

Interference in Indonesia by Tobacco Industry and Allies

Tobacco industry tactics in Indonesia include the use of third parties; the targeting of youth with tobacco marketing, both at point of sale and online, as well as via event sponsorship; and sponsorship of popular sports such as badminton and football.

Use of third parties

The tobacco industry has long used third parties and front groups to advance its interests, as a means of achieving greater credibility and overcoming public mistrust.

The Indonesian Tobacco Farmers’ Association (Asosiasi Petani Tembakau Indonesia, APTI), a lobby group, opposes the WHO FCTC, and has urged the Indonesian government not to ratify the treaty.⁵⁶ It has also frequently lobbied against increases in excise taxes on tobacco products. In 2019, APTI held a rally in front of the Ministry of Finance, to demand the repeal of an increase in excise and the retail price of cigarettes, and the revision of a regulation requiring at least 50% of the Tobacco Excise Revenue Sharing Fund to be allocated to health purposes.⁵⁷

APTI has also opposed the proposed revision to Indonesia’s main tobacco control law, PP 109/2012. In 2022, in Temanggung, a major tobacco-growing region in Central Java, APTI representatives were seen at a public event displaying banners asking the local government for support in opposing the proposal.⁵⁸ APTI also sent official letters to President Widodo opposing the revision, stating that it would negatively affect the livelihoods of people working in the tobacco sector, particularly farmers.⁵⁵

Another lobby group which has opposed of any revision of PP 109/2012 is the Indonesian Tobacco Community Alliance (Aliansi Masyarakat Tembakau Indonesia, AMTI), a coalition of tobacco industry stakeholders – including cigarette manufacturers – established in 2010.⁵⁹ It reportedly has close links to the PMI subsidiary Sampoerna.⁶⁰⁶¹ AMTI has sought to portray tobacco control as an agenda imposed on Indonesia by foreign actors who do not understand the local context – a common tobacco industry tactic in the country.⁶²⁶³

Both APTI and AMTI are affiliates of the International Tobacco Growers Association (ITGA), a global front group funded and run by the ‘Big Four’ transnational tobacco companies (TTCs), as well as two major leaf merchants.⁶⁴⁶⁵⁶⁶ Though ITGA claims to defend the interests of tobacco farmers and their communities around the world, it uses tobacco farmers as a means of opposing tobacco control regulations and protecting the interests of the TTCs.⁶⁶

Controversial marketing strategies: targeting youth

The tobacco industry has long seen young people as a vital target market; tobacco use generally starts in adolescence. In Indonesia, the mean age of smoking initiation amongst males is 18.3 years, while smoking prevalence amongst Indonesian adolescents (aged 10 to 18) increased from 7% in 2013 to 9% in 2018.⁶⁷⁶⁸

In Indonesia, there is a high concentration of tobacco retailers, high exposure to point-of-sale advertising and no restriction on the display of cigarette packs in retail outlets – all of which are associated with increased tobacco use amongst adolescents.⁵³⁶⁸⁶⁹ In addition, many retailers are located close to schools; enforcement of the ban on sales to minors is very weak; while sales of single sticks, which make smoking more accessible to young people, are still permitted.⁶⁹⁶⁸⁷⁰ Retailers therefore have an important role in recruiting new, young smokers, and maintaining growth of the market.⁶⁸

Indonesia’s incomplete TAPS regulations have also allowed the tobacco industry to switch to less regulated forms of advertising such as event sponsorship and internet marketing, often targeting young people.⁷¹

For example, the popular music festival SoundrenAline, which has been running in Indonesia since 2002, was founded by Sampoerna.⁷² Following a visit to SoundrenAline 2016, researchers reported that Sampoerna branding and the slogan “Go Ahead” were found throughout the festival site. Sampoerna A brand cigarettes were widely sold, including by cigarette girls and boys – a form of direct one-on-one marketing.⁷¹⁷³ Cigarettes that were not a Sampoerna brand were confiscated at the entrance.⁷¹ As of 2022, Sampoerna was still the sponsor of the event and owner of the registered trademark for “SoundrenAline”.⁷²

With over 111 million users, Indonesia has one of the world’s largest Instagram audiences, over half of whom are aged between 13 and 24.⁷⁴ According to the Tobacco Enforcement and Reporting Movement (TERM), as of 2023, around 70% of online tobacco marketing in Indonesia took place on Instagram.⁷⁵⁷⁶ Most of this marketing is indirect and community based. Rather than display their products directly, the tobacco companies build online communities of followers with a common interest such as music, travel or sport, as a means of improving brand visibility and indirectly promoting their products.⁷⁶⁷⁵

Controversial marketing strategies: sponsorship of popular sports

Tobacco industry sponsorship of sport is as old as professional athletic competition itself.⁷⁷ It aims to create links between pre-existing associations people may have with sports (such as fun, excitement, strength, etc.) with tobacco branding and products; promote an image of tobacco use as normal and healthy; and appeal to young people.⁷⁸

In Indonesia, TAPS has historically been very widespread in popular sports.⁷⁹ Badminton, for instance, which the New York Times has described as part of Indonesia’s “national identity”, has long been a vehicle for tobacco industry sponsorship.⁸⁰ From 2006, Djarum was the corporate sponsor of the national badminton trials for children and adolescents aged from 5 to 18.⁸¹ The trials were shown on national television, and participants were required to wear clothing which displayed the Djarum logo.⁶⁸⁸¹

Ten civil society organisations reported Djarum to the National Commission on Child Protection, arguing that the sponsorship violated Indonesia’s child protection law.⁸¹ In 2019, Djarum agreed to remove its logos from the badminton trials.⁸²⁸³ It also withdrew its sponsorship from future trials, which critics argued would undermine development of young talent. However, in 2021 the state-owned telecommunications firm Telkom replaced Djarum as sponsor.⁸¹

Djarum owns the PB Djarum badminton club in Kudus, Central Java, which has a youth academy, as well as a club in Jakarta.⁸⁰⁷⁵⁸⁴ The company also continues to market itself and its products indirectly via Djarum-associated social media accounts which focus on badminton-related content.⁷⁶⁷⁵

An investigation into tobacco marketing on social media in Indonesia, India and Mexico around the 2022 FIFA World Cup found that 92% of the football-themed tobacco marketing originated from Indonesia, with 81% being produced by Djarum alone.⁷⁹

Both Gudang Garam and Djarum, via their respective brands Intersoccer and Super Soccer, sponsored live World Cup viewing parties. Super Soccer, which describes itself as the “home of soccer fans in Indonesia”, promotes its activities on social media to hundreds of thousands of followers.⁷⁹ It developed a “Soccerphoria” event series and campaign specifically for the World Cup, which were heavily promoted across its accounts. As well as the live viewing parties, these events involved mural painting, branded clothes, and limited-edition World Cup cigarette packs designed by local artists.⁷⁹

In 2019, Djarum bought the Italian Serie B club Como 1907, via its subsidiaries SENT Entertainment Ltd and Mola TV. Mola, a television streaming service, has broadcast a reality TV series following 24 young footballers trying to succeed at Como 1907.

• For more on this topic please see the pages on Football Sponsorship and Social Media.

Relevant Links

• Indonesia factsheet, Tobacco Atlas
• Indonesia Tax Scorecard, Tobacconomics
• Dashboard Kawasan Tanpa Rokok [Smoke-Free Area Dashboard], Indonesia Ministry of Health
• Situation reports: Indonesia, Tobacco Enforcement and Reporting Movement, Vital Strategies
• Indonesia, Southeast Asia Tobacco Control Alliance
• Front Groups Indonesia, Southeast Asia Tobacco Control Alliance

Tobacco Tactics Resources

• Flavoured and Menthol Tobacco in LMICs
• Greenwashing
• Gudang Garam and sports endorsement
• Lobby Groups
• Tobacco Industry Tactics

References

The post Indonesia Country Profile appeared first on TobaccoTactics.

Image source: Storm Crypt/CC BY-NC-ND 2.0 DEED

Key Points

• The Philippines is an island nation in Southeast Asia consisting of over 7,000 individual islands. It is part of the World Health Organization’s Western Pacific Region.
• Its population was 115.6 million as of 2022. The previous year, adult tobacco use prevalence was 19.5%.
• The Philippines ratified the World Health Organization Framework Convention on Tobacco Control in 2005. It has not signed the Protocol to Eliminate Illicit Trade in Tobacco Products.
• PMFTC Inc. – a joint venture between Philip Morris International and the Fortune Tobacco Corporation, the tobacco business of local conglomerate LT Group – has the largest share of the Philippine cigarette market. Japan Tobacco International accounts for most other sales.
• Recent tobacco industry tactics in the Philippines include attempting to influence the committee responsible for overseeing tobacco control in the country; corporate social responsibility, particularly during the COVID-19 pandemic; and establishing relationships with public officials, including at the very top of government.

The Philippines has made some progress on tobacco control, especially since the introduction of the reforms known as the Sin Taxes in 2013. These both greatly simplified tax structures and significantly increased excise on tobacco and alcohol products, with a substantial share of the new revenue being channelled into universal healthcare.⁸⁵ Tobacco use prevalence, which stood at 29.7% in 2009, had fallen to 23.8% by 2015, and again to 19.5% by 2021.⁸⁶¹⁰ However, rising incomes and subsequent smaller increases in tobacco taxes have made cigarettes more affordable, slowing further progress.⁸⁷ Other challenges include an illicit tobacco market larger than the global average;⁸⁸ the growing popularity of newer nicotine and tobacco products (particularly e-cigarettes) amongst young people;⁸⁹ and ongoing tobacco industry presence on the inter-agency committee responsible for implementing tobacco control regulation in the country.⁹⁰ Philippine domestic law continues to fall short of what is required by the World Health Organization Framework Convention on Tobacco Control (WHO FCTC) across a number of areas.⁵³

Tobacco Use in the Philippines

In 2022, the population of the Philippines was 115.6 million.⁹¹ According to the 2021 Global Adult Tobacco Survey (GATS), tobacco use prevalence amongst Filipino adults was 19.5%.¹⁰ Prevalence is much higher amongst males (nearly 35%) than females (just over 4%).¹⁰ Amongst adolescents aged between 13 and 15, 12.5% were using some form of tobacco in 2019.¹¹ Again, prevalence for males (over 18%) is higher than for females (nearly 7%).¹¹

In the 2021 GATS, just over 2% of Filipino adults reported current use of e-cigarettes (3.6% males; 0.5% females).¹⁰ However, use of e-cigarettes is considerably higher amongst youth. In the 2019 Global Youth Tobacco Survey, the corresponding figure was over 14% – higher than for conventional cigarettes (10%).¹¹ More than 20% of boys aged between 13 and 15 reported using e-cigarettes, compared to 7.5% of girls.¹¹ Smokeless tobacco use in the Philippines also appears to be greater amongst the young: in 2019, 3% of young people reported current smokeless tobacco use, compared to 1.5% of adults in 2021.¹¹¹⁰

There were an estimated 95,600 deaths attributable to tobacco use in 2019, accounting for nearly 15% of all mortality in the Philippines that year.⁹² According to a 2018 study, the economic burden of tobacco use in the Philippines in 2012 was just under PHP₱270 billion (US$15.1 billion according to the purchasing power parity exchange rate) – equivalent to 2.5% of national GDP. This includes both direct costs resulting from tobacco use (e.g., hospitalisations and medication) as well as indirect costs (reduced productivity due to disability and mortality). The same study found that diseases attributable to tobacco use accounted for nearly 5% of total health expenditure.⁹³

Tobacco in the Philippines

Market share and leading brands

PMFTC Inc. (PMFTC) dominates the Philippine cigarette market, with a market share of around 61% in 2022.¹⁸ PMFTC is a joint venture between Philip Morris International (PMI) and the Fortune Tobacco Corporation, the tobacco business of local conglomerate LT Group.⁹⁴

Japan Tobacco International (JTI) has a market share of 38%, thanks to its 2017 acquisition of local company Mighty Corporation.¹⁸⁹⁵ Together, PMFTC and JTI account for virtually all of the licit cigarette sales in the country.¹⁸

PMI’s flagship brand Marlboro is the most popular brand of cigarette, with a share of nearly 33% in 2022. In second place is another PMFTC brand, Fortune International, with a share of nearly 17%. JTI’s Winston is third, with a market share of around 14%. All other brands have market shares of less than 10%.⁹⁶

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

At nearly 23%, the Philippines has one of the largest market shares for menthol cigarettes in the world.⁹⁷⁹⁸ Menthol cigarettes have been marketed in the Philippines since at least the 1970s, including in campaigns targeting young women.⁹⁹ In more recent times, the menthol market share has increased year on year since 2014. Similarly, though the market for flavour capsule cigarettes is much smaller than for menthol, it has also been growing steadily, with yearly increases since 2015.⁹⁷ These products are often more attractive to youth and young adults than conventional cigarettes; menthol in particular is associated with increased smoking initiation.⁹⁸

• For more information, please see the page on Flavoured and Menthol Tobacco in LMICs.

Tobacco farming and child labour

Since the early 1960s, tobacco production in the Philippines has remained roughly stable, at between 40,000 and 70,000 tonnes a year. However, between 1981 and 1993 it increased to between 74,000 and 118,000 tonnes. Conversely, between 2006 and 2009 it dipped below 40,000, to a low of 32,000 tonnes in 2008.¹⁰⁰

Figure 1: Tobacco production, 1961 to 2021.¹⁰⁰ Source: UN Food and Agriculture Organization/Our World in Data | CC BY

Research has demonstrated that tobacco growing is not a profitable enterprise for most farmers. Despite this, farmers continue to grow tobacco due to a belief in its profitability and the reliability of the tobacco market; its perceived resilience to bad weather compared to other crops; and, in particular, access to credit.¹⁰¹ Filipino farmers interviewed for a study published in 2019 stated that tobacco farming allowed them to take out loans to which they would not have had access had they been growing other crops. Loans were also used to cover non-agricultural expenses such as school fees, buying food, and paying off other loans.¹⁰¹

As part of the Sin Tax reforms, 15% of the revenue collected from tobacco taxes is allocated to tobacco-growing communities to promote economically viable alternatives.¹⁰² However, this remains a challenge. Farmers have cited lack of capital, difficulties accessing credit, an absence of technical support and a perceived lack of markets for other crops as reasons for not transitioning away from tobacco.¹⁰¹

Tobacco is also one of 13 commodities produced in the Philippines which feature on the U.S. Department of Labor’s 2022 List of Goods Produced by Child Labor or Forced Labor.¹⁰³ However, comprehensive and up-to-date information on child labour in Philippine tobacco farming is not available.

Tobacco and the economy

The Philippines is a net importer of raw tobacco, importing about US$243 million of raw tobacco in 2022, compared to exports of around US$184 million.¹⁰⁴¹⁰⁵ However, the country is a net exporter of cigarettes, with exports in the same year of over US$232 million, compared to about US$22.6 million in imports.¹⁰⁶¹⁰⁷

Illicit trade

Illicit tobacco was estimated to form around 16% of the market in the Philippines in 2018.⁸⁸ Though this is above the likely global average of 11 to 12%, it has changed little since 1998.⁸⁸¹⁰⁸ Though industry-funded studies found significant increases in the Philippine illicit tobacco trade following the introduction of the Sin Taxes in 2013, there is no independent evidence to support this.⁸⁸

Tobacco and the environment

The WHO reports that curing in tobacco agriculture is a leading cause of demand for wood from native forests in the Philippines.¹⁰⁹

Farmers cultivating the native batek variety of tobacco in the southern Philippines have been documented as using several toxic agrochemicals to control pests. These include some listed as hazardous by the WHO, such as cypermethrin and methomyl.¹¹⁰

It has been estimated that between 30 and 50 billion cigarette butts are littered every year in the Philippines – 12.5 million on the resort island of Boracay alone.¹¹¹ Boracay was closed for six months in 2018 for environmental rehabilitation, resulting in billions in lost revenues for both government and the private sector.¹¹¹¹¹²

• For more information on the tobacco industry’s environmental impact, please see Tobacco and the Environment and the long read on Plastics, the Environment and the Tobacco Industry.

Roadmap to Tobacco Control

The Philippines ratified the WHO FCTC in 2005 and the treaty entered into force later that year.¹¹³¹¹⁴ WHO FCTC ratification was a catalyst for strengthening tobacco control laws in the country and reducing industry influence on policy.¹¹⁴ However, the Philippines is not a party to the Protocol to Eliminate Illicit Trade in Tobacco Products.¹¹⁵

The Tobacco Regulation Act of 2003 (RA 9211) is the country’s main tobacco control law, covering areas such as smoking in public places; tobacco advertising, promotion and sponsorship; and sales restrictions. Subsequent legislation built on the 2003 law, introducing further regulation on issues such as designated smoking areas, advertising and the packaging and labelling of tobacco products.¹¹⁶

However, given that RA 9211 was enacted just three months before the Philippines signed the WHO FCTC, Filipino tobacco control advocates have argued that the law was both timed and designed to pre-empt the Convention. This has resulted in tobacco control regulations which, nearly 20 years later, still fall some way short of WHO FCTC requirements.⁹⁰¹¹⁷ Designated smoking areas are still permitted in indoor offices and workplaces; restaurants; and cafés, pubs and bars. Restrictions on tobacco advertising, promotion and sponsorship remain incomplete. And at 50.6% of the retail value of the most popular brand of cigarettes, tobacco taxation is significantly below the 75% threshold recommended by the WHO.⁵³

The tobacco industry, led by the Philippine Tobacco Institute (PTI), has also used RA 9211 as justification for delaying the introduction of more WHO FCTC-compliant measures (such as graphic health warnings), arguing that such measures contravene existing Philippine law.¹¹⁷¹¹⁸

In August 2020, the joint House Committees on Trade and Industry and on Health approved a bill regulating manufacture, sale and use of e-cigarettes and heated tobacco products (HTPs).¹¹⁹ This bill reversed an earlier decision to raise the purchase age from 18 to 21 and restrict flavourings to tobacco and plain menthol. It also shifted responsibility for regulation of these products from the Food and Drug Administration to the Department of Trade and Industry. Eight days after the bill was approved, the first of four stores dedicated to PMI’s flagship HTP IQOS opened for business.¹²⁰

This bill was a precursor to the Vaporized Nicotine and Non-Nicotine Products Regulation Act, which eventually became law in July 2022. E-cigarettes in hundreds of different flavours reportedly flooded the Philippine market in the months following the passage of the law.¹²¹ Leading Filipino tobacco control advocates argue that the law has undermined recent gains in tobacco control.¹²⁰

For more details, please see the following websites:

• Legislation by country/Jurisdiction – Philippines, Tobacco Control Laws, Campaign for Tobacco Free Kids
• Philippines, WHO FCTC Implementation Database, WHO FCTC Secretariat
• Country profile – Philippines, World Health Organization, WHO report on the global tobacco epidemic 2023

Tobacco Industry Interference in the Philippines

Recent tobacco industry tactics in the Philippines include attempting to influence the committee responsible for overseeing tobacco control in the country; corporate social responsibility, particularly during the COVID-19 pandemic; and attempts to influence policy, including by establishing relationships at the very top of government.

Conflict of interest

The Philippines’ main tobacco control law, RA 9211, requires the government to implement a “balanced policy”, given that:

“It is the policy of the State to protect the populace from hazardous products and promote the right to health and instill health consciousness among them. It is also the policy of the State, consistent with the Constitutional ideal to promote the general welfare, to safeguard the interests of the workers and other stakeholders in the tobacco industry.”¹²²

However, the first principle of the implementation guidelines for Article 5.3 of the WHO FCTC states that “There is a fundamental and irreconcilable conflict between the tobacco industry’s interests and public health policy interests.”¹²³ Any requirement for “balance” can only therefore hinder progress on tobacco control and undermine public health.

This may be seen in the composition of the Interagency Committee on Tobacco (IAC-T), a multisectoral body established by RA 9211 responsible for overseeing implementation of the legislation.¹²² One seat on the IAC-T is reserved for the National Tobacco Administration (NTA) – a government agency that sits within the Department of Agriculture – which has a mandate to “Promote the balanced and integrated growth and development of the tobacco industry to help make agriculture a solid base for industrialization.”¹²⁴

Another seat is reserved for a representative of the tobacco industry, specifically the Philippine Tobacco Institute (PTI), an association whose members over the years have included PMFTC and JTI, among others.^122125126127 The PTI has a long history of undermining tobacco control measures, including successfully managing to reduce the size of graphic health warnings on tobacco products, opposing tobacco tax reforms and litigating over tobacco control regulations against public bodies such as the City of Balanga and the Department of Health.^126128129

Tobacco control advocates have called repeatedly for the removal of the PTI from the IAC-T, citing conflict of interest and alleging that it uses its position to actively weaken tobacco control policies.^126130131 The WHO has supported this position, stating that the composition of the Philippine IAC-T “is blatantly in conflict with WHO FCTC Article 5.3”, which requires parties to protect their public health policies against the commercial and other vested interests of the tobacco industry.¹³²

Corporate social responsibility

As of 2023, there was still no ban on tobacco industry corporate social responsibility (CSR) in the Philippines.⁵³ The tobacco industry has taken advantage of this shortcoming to try to enhance its reputation and influence both policy makers and the general public.

From 2017 to 2021, PMI spent nearly US$38 million on CSR in the Philippines. Nearly US$31 million of this total was spent in 2020 and 2021 alone.¹³³ Much of this funding is channelled through the Jaime V. Ongpin Foundation (JVOFI), a development NGO and partner of “Embrace”, PMFTC’s CSR programme.¹³³¹³⁴ During 2020, in the first months of the COVID-19 pandemic, JVOFI distributed ambulances, ventilators, PCR machines for COVID-19 testing, personal protective equipment, food supplies and rapid test kits throughout the country.¹³⁴

PMI was far from the only tobacco industry player carrying out this kind of work: by mid-April 2020, the LT Group – PMI’s partner in joint venture PMFTC – had spent PHP₱200 million (around US$4 million) on COVID-19 assistance.¹³⁴ The LT Group implements such initiatives in the Philippines via its CSR arm, the Tan Yan Kee Foundation.¹³⁵ Also in April 2020, Japan Tobacco International (JTI) donated 20,000 face masks to hospitals in the province of Batangas, where its manufacturing facilities are located.¹³⁴

An investigation published by the media and business intelligence organisation Eco-Business in 2021 revealed that a number of congressional representatives were involved in the distribution of COVID-19 relief donated by the tobacco industry and its associates.¹²⁰ These donations also coincided with several debates in Congress which addressed regulation for newer nicotine and tobacco products (see section “Roadmap to Tobacco Control”).¹²⁰¹¹⁷

Both PMI and JTI also lobbied the Philippine Ministry of Finance for permission to continue their operations as normal during lockdown, though cigarettes were not considered to be an essential item.¹³⁴ In an April 2020 press release, JTI argued that lockdown restrictions were forcing smokers to buy illicit tobacco; were resulting in lower tax revenues for government; and were harming retailers, especially small and family-run businesses.¹³⁶ Restrictions on the transport and delivery of tobacco products were subsequently lifted.¹³⁷

This shows how industry arguments around the illicit trade were accepted by Filipino policy makers, allowing tobacco companies to operate even during an outbreak of a lethal respiratory disease to which smokers are more vulnerable.¹³⁸

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

Unnecessary interaction with high level officials

Hailing from the Ilocos region, where tobacco is a major cash crop, President Ferdinand “Bongbong” Marcos Jr. has met with PMI at least twice since becoming president in June 2022.¹²¹¹³⁹ The most recent of these meetings was a lunch he and First Lady Liza Araneta-Marcos hosted for PMI executives – including CEO Jacek Olczak – at the Malacañang Palace in November 2022, the first time a company CEO has been received at the Philippine presidential palace. Also present were PMFTC president Denis Gorkun and LT Group CEO Lucio Tan III.¹²¹

PMFTC’s director for global communications stated that the aim of the meeting was to outline the company’s plan “to expand our economic footprint in the Philippines.”¹²¹ PMI is reportedly investing US$150 million in the expansion of a manufacturing plant in Tanauan, Batangas. The new wing of the factory is to be used for the production of BLENDS, tobacco sticks used exclusively in PMI’s BONDS, a more affordable version of its flagship HTP IQOS.¹²¹

In 2012, the then Senator Marcos was photographed during a Senate debate on the Sin Taxes speaking to a lawyer representing PMFTC.¹⁴⁰¹⁴¹

Relevant Links

• The Toll of Tobacco in the Philippines, Campaign for Tobacco-Free Kids, 2023
• Tobacco Industry Interference Index 2022: The Philippine Report on the Implementation of the WHO Framework Convention on Tobacco Control, HealthJustice, 2023
• Global Adult Tobacco Survey, Fact Sheet, Philippines 2021, Republic of the Philippines Department of Health, Philippine Statistics Authority, WHO Philippines et al
• Global Youth Tobacco Survey, Fact Sheet, Philippines 2019, Republic of the Philippines Department of Health, Epidemiology Bureau, WHO Western Pacific Region et al
• Tobacco Industry Monitor – Philippines, Southeast Asia Tobacco Control Alliance, 2024

Tobacco Tactics Resources

• Flavoured and Menthol Tobacco in LMICs

References

The post Philippines Country Profile appeared first on TobaccoTactics.

Image source: Luis Barrios/CC BY-NC-ND 2.0

Key Points

• Mexico is a country in North America, covered by the World Health Organization’s Regional Office for the Americas.
• It has a population of over 127.5 million with current smoking prevalence of 19% amongst the population aged 20 and over.
• Mexico ratified the World Health Organization Framework Convention on Tobacco Control in 2004. It has not joined the Protocol to Eliminate Illicit Trade in Tobacco Products.
• The Mexican tobacco market is dominated by the big transnational tobacco companies, particularly Philip Morris International and British American Tobacco.
• Recent tobacco industry tactics in Mexico include the use of third parties; the targeting of youth with marketing for newer nicotine and tobacco products, particularly on social media; and corporate social responsibility, including during the COVID-19 pandemic.

Mexico significantly reduced smoking prevalence between 2002-2009, in the years around ratification of the World Health Organization Framework Convention on Tobacco Control (WHO FCTC).^142143144 However, between 2009 and 2016 there was no further progress. This may be explained by ongoing industry interference, such as on price and tax; the introduction and rapid growth of flavour capsule cigarettes; as well as challenges involved with implementation of Mexico’s main tobacco control law.¹⁴⁴¹⁴⁵ In more recent years, Mexico has redoubled its efforts, passing a major amendment to its tobacco control law in 2021 which significantly increased compliance with the WHO FCTC.¹⁴⁶ Mexico now has some of the most comprehensive tobacco control regulation in the world.¹⁴⁶¹⁴⁷

Tobacco Use in Mexico

In 2022, the population of Mexico was over 127.5 million.¹⁴⁸ According to the 2021 National Health and Nutrition Survey on COVID-19 (ENSANUT), prevalence of current smoking in the Mexican population aged 20 and over was just over 19%. There is significant difference between males and females, with nearly 30% of men reporting current smoking compared to around 9% of women. Prevalence of current smoking amongst Mexican youth aged from 10 to 19 was less than 5%, with 7.5% of males in this age range smoking compared to less than 2% of females.¹⁴⁹

There were an estimated 48,400 deaths attributable to smoking in 2019, accounting for 6.6% of all mortality in Mexico that year.¹⁵⁰ A study published in 2021 estimated the total cost of tobacco use to the Mexican economy at US$8.2 billion per year. US$5.1 billion is spent on treating diseases associated with tobacco use – equivalent to 9.3% of the annual health budget. The US$1.9 billion that Mexico receives in revenue from the tobacco industry covers just 38% of the burden of tobacco use.¹⁵¹

Since 2008, Mexico has prohibited sale, distribution and promotion of any product that resembles a cigarette, which has been applied to e-cigarettes and heated tobacco products (see section “Roadmap to Tobacco Control”).¹⁵²¹⁵³ Even so, in the 2021 ENSANUT survey, current use of e-cigarette by adults aged 20 and over was 1.6% (2.5% for males; 0.7% for females). Amongst youth aged 10 to 19, prevalence was slightly higher, at 1.8% (2.4% for males; 1.1% for females).¹⁴⁹ A 2022 survey by the National Commission Against Addictions estimated that five million Mexicans between the ages of 12 and 65 had used e-cigarettes at some point, with 975,000 being current users.¹⁵⁴

Tobacco in Mexico

Market share and leading brands

In 2022, market research company Euromonitor International estimated the Mexican tobacco market to be worth nearly 89 billion Mexican pesos (US$4.5 billion), mostly accounted for by cigarette sales.¹⁵⁵ The market is dominated by the big transnational tobacco companies (TTCs), particularly Philip Morris International (PMI) and British American Tobacco (BAT), and to a much lesser extent Japan Tobacco International (JTI). Between them, these three companies accounted for virtually all legal cigarette sales in 2022. PMI is the market leader with just over 60%, followed by BAT with just under 36%. JTI’s share was 4%.¹⁸

As of 2022, the top six brands in Mexico were all manufactured by either PMI or BAT. By far the most popular cigarette was PMI’s premium brand Marlboro, with a market share of over 48%. This was followed by BAT’s mid-range cigarette Pall Mall, with under 22%. All other brands had a share of less than 10%.¹⁵⁶

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

The use of flavour capsule cigarettes is particularly high in several Latin American countries, including Mexico, where their share of the market has risen year on year since 2012.¹⁵⁷ Although they were only introduced in 2011, flavour capsule cigarettes accounted for nearly 28% of the cigarette market in 2022 – amongst the highest proportions in the world.¹⁴⁴¹⁵⁸ Research has shown that flavour capsules increase the appeal of cigarettes and stimulate a desire to try them, particularly amongst young people.¹⁵⁸¹⁵⁹

• For more information, see Flavoured and Menthol Tobacco in LMICs.

Tobacco farming and child labour

Tobacco growing in Mexico has fallen considerably since 1980, when it produced nearly 94,000 tonnes of leaf, to under 7,000 tonnes in 2010 (see Figure 1). However, in 2010 production started to increase again, rising to over 15,000 tonnes by 2012, since when the figure has remained roughly stable.¹⁰⁰

Figure 1: Mexican tobacco production, 1961 to 2020.¹⁶⁰ Source: UN Food and Agriculture Organization/Our World in Data | CC BY

Similarly, in 1980 the harvested area was 42,000 hectares, falling to 4,000 hectares in 2010, but up to 7,000 in 2020.¹⁰⁰

A series of exposés in the 1990s revealed widespread use of child labour on Mexico tobacco farms, as well as the use of banned agrochemicals and poor living and working conditions for tobacco pickers. While the industry claims much has changed since then, an investigation by The Guardian in 2018 found children working on seven out of the ten farms the report visited in the state of Nayarit, Mexico’s main tobacco growing region. The farms featured in the investigation were supplying PMI, BAT and Universal Leaf Tobacco.¹⁶¹

• 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

Mexico is a net exporter both of tobacco leaf and cigarettes. According to UN Comtrade, it exported approximately US$7.1 million in raw tobacco in 2022, compared to around US$2.4 million in imports.¹⁶²¹⁶³

A 2021 report on the impacts of tobacco tax, published by the Center of Research on Food and Development (CIAD), which bases its calculations on the Secretariat of Economy’s Online Tariff Information System, puts the figure for cigarette exports in 2019 at close to US$180 million, compared to imports of over $10 million.¹⁶⁴ This corresponds to customs data from Descartes Datamyne, which put cigarette exports for 2020 at over $168 million, compared to imports of US$10.7 million.¹⁶⁵ However, the Comtrade figure for cigarette exports in 2020 is much lower.¹⁶⁶ No import data is available on Comtrade for that year.

According to the CIAD report, seventy per cent of Mexican cigarette exports served the Canadian market, 15% the Colombian market, and 11% Central American markets.¹⁶⁴ Customs data also indicates these are the main export destinations for cigarettes manufactured in Mexico.¹⁶⁵

The CIAD report also states that the tobacco industry is a relatively small sector of the Mexican economy, employing just 0.1% of the national workforce in 2018.¹⁶⁴

Illicit trade

In a 2021 study which measured the Mexican illicit tobacco trade using two methodologies, illicit cigarettes accounted for 8.8% of total consumption based on an analysis of discarded packs, and 7.6% based on a survey of smokers. Both results are significantly lower than the figure of 16.6% which is widely publicised by the tobacco industry.¹⁶⁷ While the figures obtained via both methodologies represent an increase from previous estimates of illicit cigarette consumption – 0.5% in 2009 and 2.7% in 2015 – they are lower than the global average and lower than the figure for other countries in Latin America such as Brazil, Chile and Uruguay.¹⁶⁸¹⁶⁹ A previous study also found wide geographical variation across the country: for example, in Hermosillo, Sonora, just 0.3% of total cigarette consumption was illicit, while in León, Guanajato, the figure was as high as 27.5%.¹⁶⁸

There is also an illegal e-cigarette market. Between January 2021 and June 2022, Mexican authorities seized over 60,000 devices, suspending the activities of nearly 180 retail outlets.¹⁷⁰

Tobacco and the environment

Mexico produces around 40 billion cigarettes annually. This consumes between 109 and 205 billion litres of water and between 73 and 114 million kilowatts of energy. It also generates CO₂ emissions of between 20,000 and 29,000 tonnes. Around 55 million cigarette butts are discarded every day in Mexico, at an estimated cost of close to US$140 million annually.¹⁷¹

• For more information, please see the page on Tobacco and the Environment and the long read on Plastics, the Environment and the Tobacco Industry.

Roadmap to Tobacco Control

Mexico was the first country in the Americas to ratify the WHO FCTC in 2004.¹⁴³ However, it has not joined the Protocol to Eliminate Illicit Trade in Tobacco Products.¹⁷²

In 2008, The General Law on Tobacco Control came into force, containing most of the provisions established in the WHO FCTC.¹⁷³ However, it left some significant loopholes. While smoking was completely prohibited indoors in primary and secondary schools, and in federal government facilities, workplaces and other buildings with public access were permitted to provide designated smoking areas. Similarly, the law banned most forms of tobacco advertising, promotion and sponsorship, but made an exception in cases where it was aimed exclusively at adults.¹⁷⁴ Some stricter regulation was introduced at subnational level. For example, Mexico City passed its own 100% smokefree law in February 2008 and in the following years 14 states followed suit.¹⁷⁵¹⁷⁶

In 2021, the Mexican Senate unanimously approved a key amendment to the 2008 General Law, which banned smoking in all enclosed public spaces and workplaces, as well as banning all forms of tobacco advertising.¹⁴⁶ A further update, which came into force in January 2023, extended smoke-free legislation even to open-air environments where there may be public gatherings, such as parks, beaches and restaurant terraces. It also bans the display of tobacco products in all retail outlets.^147177178 With these two measures, Mexico made important progress towards full compliance with the WHO FCTC.¹⁴⁶

Mexico has taken a tough stance on newer nicotine and tobacco products. Since 2008, there has been a ban on any product that resembles a cigarette.^179180181 Regulators have applied this law to e-cigarettes and heated tobacco products (HTPs), but it has been contested by both retailers and tobacco companies.¹⁵²¹⁷⁹ In 2020, the government banned imports of e-cigarettes and HTPs, bringing customs law into line with existing health regulations.¹⁸² Though a decree published by the Secretariat of Economy in July 2021 created an exception for HTPs, this was reversed by a new presidential decree in October of the same year.¹⁸³¹⁸⁴

Finally, on World No Tobacco Day in May 2022, President Andrés Manuel López Obrador signed a decree imposing a total ban on “circulation and marketing” of e-cigarettes and HTPs. This effectively makes the import and sale of these products illegal in Mexico.¹⁷⁹¹⁸⁵

For more details, please see the following websites:

• Legislation by country – Mexico, Tobacco Control Laws, Campaign for Tobacco Free Kids
• Mexico, WHO FCTC implementation database, WHO FCTC Secretariat
• Country Profile – Mexico, World Health Organization, WHO report on the global tobacco epidemic 2023

Tobacco Industry Interference in Mexico

Tobacco industry tactics in Mexico include the use of third parties; the targeting of youth with marketing for newer nicotine and tobacco products, particularly on social media; and corporate social responsibility, including during the COVID-19 pandemic.

Use of third parties

Tobacco companies often lobby via industry and trade associations, think tanks, front groups and other third parties, including public relations (PR) companies and professional lobbyists.

In Mexico, the Confederación Patronal de la República Mexicana (COPARMEX) is an employers’ union, which brings together businesses of all sizes and from all sectors.¹⁸⁶ In 2021, Philip Morris International (PMI) listed COPARMEX as one of the business and trade organisations in which it held a leadership role.¹⁸⁷

In May 2022, Mexico held a public consultation on an update to its revised tobacco control law, regarding proposals to completely ban the display of tobacco products at points of sale, and to further restrict designated smoking areas to limited open-air environments.¹⁷⁷ COPARMEX’s submission to the consultation argued that cost of implementing these measures would be high and adversely impact the owners of small businesses; that the proposals violated the right to free trade; and that they would fuel the growth of the illicit trade.¹⁸⁸

The National Tobacco Industry Council (CONAINTA) – of which PMI, BAT and JTI are all members – also opposed these measures, arguing that they would have a negative impact on the national economy, including on tobacco growing communities; that they violated consumer rights; and that they would endanger jobs and investment.¹⁸⁹ In 2023, the president of CONAINTA warned that there would be a “storm” of legal appeals against the updated tobacco control law.¹⁹⁰

Controversial marketing: targeting youth

The tobacco industry has long seen young people as a vital target market; tobacco use generally starts in adolescence. According to the 2016-7 National Survey of Drugs, Alcohol and Tobacco Consumption, the average age of initiation for daily tobacco consumption in Mexico was less than 20 years old.¹⁹¹

Mexican media have documented tobacco companies targeting young people with marketing for newer nicotine and tobacco products via social media. From around 2018, industry hashtags – such as #FuturoSinHumo (“#SmokeFreeFuture”) and #EligeElCambio (“#ChooseChange” – both PMI) and #vypefriends and #govype (both BAT) began to appear on posts by popular Mexican actors, influencers, comedians and others.¹⁹²¹⁹³ Products such as PMI’s HTP IQOS and BAT’s e-cigarette Vype (since rebranded as Vuse) featured visibly in this content, though often company sponsorship was not made explicit.¹⁹²

Even before the General Law on Tobacco Control was amended in late 2021, it prohibited tobacco advertising, promotion and sponsorship in all but three circumstances: in adult magazines, in adult-only establishments, or in personal correspondence to adults via post. It also specifically prohibited the online marketing of tobacco products.¹⁷⁴ According to a lawyer at the Centro de Investigación y Docencia Económicas, “these products must comply with the General Law on Tobacco Control, which clearly establishes a near-total ban on this publicity.”¹⁹²

A 2022 study on exposure to e-cigarette advertising and the social acceptability of e-cigarette use in Mexico identified online advertising as one of the channels of exposure most significantly associated with a higher likelihood of perceiving e-cigarettes as socially acceptable.¹⁹⁴ According to a researcher at the National Institute of Public Health – one of the authors of the study – the industry’s aim is the “renormalization” of nicotine consumption amongst young people.¹⁹²

• See also the page on PMI’s Futuro Sin Humo campaign.

The tobacco industry has also sponsored motorsports in Mexico. In the 2022 Mexico City Grand Prix, held in October, the McLaren cars displayed BAT’s Vuse branding – in an apparent violation of the comprehensive ban on e-cigarettes brought in just months beforehand.¹⁹⁵ Motorsport sponsorship is a longstanding and well-documented promotional strategy aimed at young people, particularly boys and young men.¹⁹⁶

Corporate social responsibility

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

In 2018, PMI’s local subsidiary Philip Morris México (PMM) set up a partnership with a local start-up, Eco Filter, which uses biotechnology to recycle cigarette butts.¹⁹²¹⁹⁷ This partnership involves clean-up and collection initiatives which target young people, with events taking place at concerts, parks and universities. Eco Filter also delivers presentations to young people in which it displays PMI logos, and has used the social media hashtag and PMI slogan #FuturoSinHumo.¹⁹²¹⁹⁸ Eco Filter states that it does not promote PMI’s products or encourage nicotine consumption amongst young people.¹⁹²

In 2021, Eco Filter opened a new factory in Guadalajara, Jalisco, with support from PMM.¹⁹⁷¹⁹⁹ It will process waste from PMM’s manufacturing facility near Guadalajara, as well as cigarette butts from the street.²⁰⁰²⁰¹

• See also Cigarette Filters.

Both PMI and BAT carried out extensive corporate social responsibility (CSR) activities in Mexico during the COVID-19 pandemic. In May 2020, PMI donated electric beds, vital signs monitors and ventilators to a hospital in Guadalajara. PMI also donated money for personal protective equipment (PPE) for healthcare professionals, and meals to a public welfare institution.²⁰² BAT joined a programme called UNIR y DAR (“UNITE and GIVE”) with other local companies in Nuevo León, where BAT México is headquartered. As part of an initiative called #RespiraNL, these companies made donations for PPE.²⁰³ BAT also provided food supplies in Guadalupe, Nuevo León.²⁰⁴

There are also CSR initiatives on child labour in Mexico. For example, since 2001 BAT has run a programme called “Florece” (meaning “Blossom” or “Flourish” in English), which provides day centres for the children of workers in the tobacco fields of Nayarit.²⁰⁵²⁰⁶

• 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

• III Índice Regional de Interferencia de la Industria Tabacalera en países de América Latina y el Caribe 2023, Corporate Accountability, Global Center for Good Governance in Tobacco Control
• Mexico – Tobacco Industry Interference Index 2021, Global Center for Good Governance in Tobacco Control
• Interferencia de tabacaleras en México: reporte de índice regional, Salud Justa, 2021
• Mexico: the long road to Tobacco Control, Pan American Health Organization (PAHO)
• Mexico – Cigarette Tax Scorecard, Tobacconomics
• Tobacco Industry Interference in Mexico, STOP
• México, Organización Panamericana de la Salud

Tobacco Tactics Resources

• E-cigarettes: British American Tobacco
• Futuro Sin Humo
• Flavoured and Menthol Tobacco in LMICs
• PMI’s IQOS: Use, “Switching” and “Quitting”

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.

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 Mexico Country Profile 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.²⁰⁷ A 2019 survey also suggested that waterpipe use prevalence is particularly high, and higher amongst women than men.²⁰⁸ Tobacco products were easily affordable until the start of Lebanon’s economic crisis in 2019.²⁰⁷ Though they have become less affordable since then, the decline in affordability has been weaker compared to that for other goods.²⁰⁹ 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).²¹⁰²¹¹ Though a comprehensive tobacco control law was introduced in 2011, there have been major challenges with implementation and enforcement.²¹²

Tobacco Use in Lebanon

In 2022, the population of Lebanon was 5.5 million.²¹³ 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 1990.²¹⁴ 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).²⁰⁸ It also found overall waterpipe use prevalence of 39.5%, and at over 46%, prevalence for women was higher than for men (nearly 33%).²⁰⁸ 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.²⁰⁸

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 2018.²¹⁵ The corresponding figure for Lebanese girls that year was 28%.²¹⁵ A study carried out amongst Lebanese adolescents aged 11 to 18 between 2016 and 2017 found ever use of waterpipe of 34%.²¹⁶

There were an estimated 7,810 deaths attributable to smoking in 2019, accounting for over 23% of all mortality in Lebanon for that year.²¹⁷ 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.²¹⁸

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.²¹⁹ 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”).²²⁰²²¹ 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.²²² The Regie distributes local and imported tobacco products to licensed wholesalers, at prices it determines with the Ministry of Finance (MoF).²²²²²³ These wholesalers then sell the tobacco products to retailers across Lebanon.²²² 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.²²² The Regie sets the profit margin and weekly quota of sold tobacco for both wholesalers and retailers.²²²

Overseen by the MoF, the Regie’s performance has a direct impact on the public treasury.²²² 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.²²²²¹²

Market share and leading brands

As of 2022, the Regie had a share of over 55% of the tobacco market, up from 45% in 2017.¹⁸ 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%.¹⁸

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.²²² Since 2016, international brands have also been made in Lebanon at Regie manufacturing facilities, as per agreements with the Big Four TTCs.^224225226227

The Regie brand Cedars is by far the most popular brand of cigarettes in Lebanon, with a market share of 55% in 2022.¹⁵⁶ PMI’s Marlboro is in second place with a share of around 14%.¹⁵⁶ JTI’s Winston is third (8%), followed by BAT’s Kent and Imperial Brands’ Gitanes (both around 5%).¹⁵⁶ All other brands have a market share of 3% or less.¹⁵⁶

Tobacco farming and child labour

In 2020, tobacco was being cultivated on 1.32% of Lebanon’s agricultural land.²²⁸ In 2021, tobacco production was just over 10,000 tonnes, down slightly from a high of 12,800 tonnes in 2001.²²⁹ This makes Lebanon the fifth-largest tobacco producer amongst the 14 EMRO countries for which data is available.²³⁰

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.²²² 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.²²⁰²²²

Lebanese tobacco featured on the 2022 List of Goods Produced by Child Labor or Forced Labor produced by the U.S. Department of Labor.²³¹ Tobacco production is very labour intensive and involves all or most members of the household, which includes women and children.²²⁰ On top of enduring poor wages and working conditions, female workers are also at risk of sexual violence in tobacco-growing communities.²³²

• 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.²³³²³⁴

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.²³⁵²³⁶

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$70,000.²³⁷²³⁸

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).²³⁹ With governance weak and legal cigarette production in decline, the TTCs flooded the Lebanese market with cheap contraband products.²³⁹ Though the government made direct appeals to these companies, requesting that they stop supplying distributors involved in this illicit trade, it had little effect.²³⁹ 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.²³⁹

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.²⁴⁰²⁴¹ 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.²⁴¹ These terms of reference are not disclosed, while the methodology used is highly susceptible to industry interference.²⁴²

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 2005.²⁴³ It has yet to ratify the Protocol to Eliminate Illicit Trade in Tobacco Products.²⁴⁴

In August 2011, Lebanon passed Law No. 174, its first ever tobacco control law.²¹² 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.²¹² 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.²¹²

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.²¹² There has also been a lack of political will to enforce the law.²¹² In late 2012, the then Minister of the Interior implied that the police would be flexible about enforcing the law during the holiday period.²⁴⁵ 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.²¹²²⁴⁶

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.²²²²¹² Given that this area was previously occupied by Israel, keeping farmers on this land is seen by the state as an important geopolitical objective.²¹² 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.²⁴⁷ 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.”²²⁰

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.²¹²²⁴⁸ A further decree in 2012 defined the text of the warnings, though implementation was delayed, reportedly due the Regie lobbying the Minister of Finance.²⁴⁹²⁵⁰ 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.²⁵¹²⁵²

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.²⁵¹ 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.²⁵⁰ 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.²⁵⁰ 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.²⁵¹ As of 2021, GHWs had yet to be implemented.²⁵³

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”.²⁵⁴ 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 COP8.²⁵⁴

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.”²⁵⁴

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.²⁵⁵

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.”²⁵⁶

• 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.”²⁴⁷ 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.²⁴⁷ These included senior civil servants from government departments including the Ministry of Finance, the Ministry of Economy and Lebanese customs.²⁴⁷

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 2021.²²² 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.²⁵⁷

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.²⁵⁸²⁵⁹

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.²⁶⁰

• 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.⁵¹⁵³ 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.²⁶¹

India remains the world’s second largest consumer, producer and exporter of tobacco.²⁶²²⁶³

Tobacco Use in India

In 2022, the population of India was 1.42 billion.²⁶⁴ 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.⁵³²⁶⁵ This means that in absolute numbers, there were almost 267 million tobacco users in India aged 15 and over.²⁶² 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.⁵³²⁶⁶

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.²⁶⁵

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.⁵³²⁶⁵ 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.⁵³²⁶⁵ The majority of female tobacco users in low- and middle-income countries (LMICs) are SLT users in India and Bangladesh.²⁶⁷ 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.⁵³²⁶⁶

India has the second highest number of oral cancer cases globally, accounting for a third of the total.²⁶⁸ More than 90% of India’s oral cancer cases are caused by tobacco use and of these, more than half are caused by SLT.²⁶⁹ The poor and less educated are worst affected, with much higher SLT use prevalence amongst these sections of the population.²⁶⁹ There were also over a million deaths attributable to smoking in 2019, accounting for nearly 11% of all mortality in India that year.²⁷⁰

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.²⁷¹ Smoking accounted for 74% of this cost; smokeless tobacco 26%.²⁷¹ Direct medical costs alone amounted to 5.3% of all health expenditure.²⁷¹ However, the excise tax revenue from tobacco the previous year was just 12.2% of its economic cost.²⁷¹ 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.²⁷¹ This economic burden accounts for over 1% of India’s GDP.²⁷¹

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 2022.¹⁸

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.²⁷²²⁷³

ITC Limited

ITC Limited (formerly India Tobacco Company Limited), dominates the Indian tobacco market, with a share of over 73% in 2022.¹⁸ Its largest shareholder is British American Tobacco (BAT), which held just under 30% of shares until March 2024.²⁷⁴²⁷⁵ The Indian state is also a major shareholder, via various state-owned insurance corporations and investment portfolios.²⁷⁵ Its products include India’s three bestselling brands of cigarettes: Gold Flake, Wills and Scissors.¹⁵⁶

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.²⁷⁶ 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.²⁷⁶ In March 2024, BAT reduced its holdings in ITC to 25.5%.²⁷⁷For 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.¹⁸ PMI is the second-largest shareholder with a stake of just over 25%.²⁷⁸ Major brands include Four Square, Cavenders and Tipper.¹⁵⁶

VST Industries Ltd

VST, formerly Vazir Sultan Tobacco Company, had a market share of over 9% in 2022, the third largest.¹⁸ With a stake of over 32%, BAT is its largest shareholder.²⁷⁹ Its major brands include Total, Charms and Charminar.¹⁵⁶

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.^18156280 This gives PMI a 5.4% market share from a global ownership perspective.¹⁸ 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.¹⁸¹⁵⁶ Both companies have a market share of less than 2%.¹⁸

• 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.²⁸¹ Local manufacturers account for significant segments of the market in several regions of India.²⁸¹ Similarly, bidi production depends largely on small home-based manufacturing operations and accurate data is not available.²⁸¹

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 2010.²⁸¹ There is also interest from the big cigarette companies in smokeless tobacco; Godfrey Phillips launched its own range of chewing products in 2010.²⁸² 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.²⁸³

Tobacco farming

India is the world’s second biggest tobacco producer after China, producing over 766,000 tonnes of leaf in 2020.²⁸⁴ This accounts for 9% of all global production.²⁶³ 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 2011.²⁸⁵

Child labour

Indian bidis feature on the U.S. Department of Labor’s 2022 List of Goods Produced by Child Labor or Forced Labor.²⁸⁶ 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.²⁸⁷ 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”.²⁸⁷

Tobacco and the economy

India is the world’s second largest exporter of tobacco leaf, after Brazil.²⁶³ According to UN Comtrade, India exported nearly US$816 million in raw tobacco in 2022, compared to nearly $21 million in imports.²⁸⁸²⁸⁹ 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.²⁶³

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.²⁶³

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.²⁹⁰²⁹¹

According to IBEF, the tobacco industry in India employs about 36 million people in farming, processing, manufacturing and export activities.²⁶³

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.²⁹² However, independent studies put that figure much lower, at around 3% to 6%.²⁹³ This makes illicit trade in India relatively small by global standards.²⁹⁴ A 2018 study, which found that 2.73% of the empty cigarette packs collected in India were illicit, noted significant differences across the country.²⁹⁵ Areas with greater illicit trade penetration are often targeted by studies funded by the tobacco industry to exaggerate overall levels of illicit trade.²⁹⁶

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.²⁹⁷ 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 2009-10.²⁹⁴

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.²⁹⁸ 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.²⁹⁹³⁰⁰ 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 2002.³⁰¹

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.³⁰² 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.³⁰² Cleaning up this waste costs Indian taxpayers roughly US$766 million every year.³⁰³

• 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 2004.³⁰⁴ It ratified the Protocol to Eliminate Illicit Trade in Tobacco Products in 2018.³⁰⁵³⁰⁶

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 18.³⁰⁷ Since then, a number of rules have been introduced to aid implementation of COTPA and provide definitions.⁵¹ 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.³⁰⁸

In 2020, an amendment to COTPA was drafted by the Ministry of Health.³⁰⁹ 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 21.³⁰⁹³¹⁰ 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.⁵¹³¹¹ Though their use remains rare in India as of 2023, the law closes off a huge potential market for e-cigarette companies.³¹²

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%.³¹³ GHWs are a well-established, evidence-based and cost-effective measure of reducing tobacco use.³¹⁴ 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).³¹⁵³¹⁶

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.³¹⁷³¹⁸

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.³¹⁷³¹⁸

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.³¹⁷³¹⁹ FAIFA, CII and FICCI all wrote letters to the Minister of Health, J.P. Nadda, echoing these arguments.³²⁰³²¹ The Tobacco Institute of India filed a legal challenge against the government in the High Court of Karnataka.³²² 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.³²³

These industry strategies succeeded in delaying the rollout of the 85% GHWs for a year, from April 2015 until April 2016.³²⁴ 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.³¹⁸

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.³²⁵

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.³²⁶³²⁷ Highly addictive and very cheap, gutkha is popular amongst women and young people.³²⁸

Since 2012, there have been state-level bans throughout the country in an attempt to reduce its prevalence, but it remains widely available.³²⁹³³⁰ Producers have found ways to circumvent the bans, such as by packaging and selling the constituent ingredients of gutkha separately.³³⁰³³¹

In the state of Tamil Nadu, gutkha remained widely available despite being banned in 2013.³³²³³³ 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.^317332334

Alleged recipients of bribes included a government minister, police officers and senior civil servants.³³⁵ In November 2022, after four years of investigations in three states, India’s Central Bureau of Investigation filed charges against 21 individuals.³³⁵³³²

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.³³⁶ 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.³³⁷ This helps to legitimise tobacco industry CSR, as companies argue they are only fulfilling their legal duties.²⁶¹In its sustainability reporting, ITC states that its CSR initiatives fall within the scope of the 2013 legislation.³³⁸

ITC has contributed frequently to government programmes and has worked with government institutions.²⁶¹ 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.³³⁸ 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.³³⁹³⁴⁰

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.³³⁷ 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.³³⁷³⁴¹

Corporate trademarks were widely visible during these CSR activities, and the initiatives were publicised in leading newspapers and by senior politicians.^337342343

• 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