Philip Morris South Africa (Pty) Ltd (PMSA) welcomed the release of the 2025 Illicit Trade Environment Index by the Transnational Alliance to Combat Illicit Trade (TRACIT), a global benchmark report aimed at providing an update on the set of legal, regulatory and policy recommendations designed to strengthen the fight against illicit trade around the world.
The Index ranks 158 countries based on their structural resilience to illicit trade—across sectors including tobacco, alcohol, pharmaceuticals, digital commerce, and fast-moving consumer goods—and highlights how systemic challenges such as gaps in enforcement and regulatory inconsistencies can contribute to the growth of the global black market. South Africa ranks 60th out of 158 countries, indicating moderate resistance to illicit trade, but with notable vulnerabilities in areas such as supply chain control and enforcement capacity.
“Illicit trade is not a victimless crime. It deprives the government of critical revenue, fuels organized crime, and puts legitimate businesses at a disadvantage,” said Philippe Van Gils, Director of Illicit Trade Prevention at Philip Morris International. “The TRACIT Index reminds us that a comprehensive approach is required, one that addresses corruption, strengthens enforcement, and ensures regulatory frameworks are both appropriate and effectively implemented.”
PMSA echoed TRACIT’s call for evidence-based and risk-proportionate regulation. “In the tobacco sector, high excise taxes and overly restrictive product policies can unintentionally incentivise consumers to turn to unregulated, illicit alternatives,” the company said.
“Policies must be crafted with the real-world impact in mind,” Van Gils said. “Excessive taxes on cigarettes without access to scientifically substantiated less harmful, affordable, and legal alternatives merely encourage the illicit market. A risk-based taxation model, where smoke-free products like heated tobacco are taxed significantly lower than cigarettes, can encourage adults who smoke to switch to better smoke-free alternatives.”
PMSA supports TRACIT’s multi-pronged policy roadmap to improve countries’ ability to detect, deter, and dismantle illicit trade operations. PMSA is urging the South African government and private sector stakeholders to prioritise the following:
• Crafting a national anti-illicit trade strategy, integrating smart tax policies, robust regulatory enforcement, and corruption safeguards;
• Strengthening border control and customs capacity, particularly at high-risk points such as ports and Free Trade Zones;
• Securing supply chains with digital track-and-trace systems and enhanced due diligence requirements for manufacturers and logistics providers;
• Enhancing cooperation between government, law enforcement, and the private sector, both nationally and regionally;
• Educating consumers on counterfeit and smuggled products.
“Illicit trade networks are complex, well-funded, and increasingly digital,” said Van Gils. “It’s no longer enough to raise taxes or regulate products, we need modern enforcement tools, better online regulation, and a serious crackdown on corruption.”
