Category: News This Week

As the Greek government continues to raise tobacco-products taxes as part of the austerity measures demanded by international lenders, it is having to expend more effort on trying to stem the growing tide of the illicit trade in cigarettes, which is being boosted by those tax increases.

According to a story by Andy Dabilis for the Greek Reporter, the government has raised tobacco taxes by more than 20 per cent since the economic crisis began in 2009, and recently announced that another five cents were to be added to the tax charged on a pack of cigarettes.

Austerity-stricken Greeks are responding by increasingly turning to illicit cigarettes that are typically sold for half the price of licit cigarettes.

The government estimates it is losing about €700 million annually to the illegal cigarette trade and the finance ministry said tobacco revenues had decreased by 11 per cent during the past two years to €2.7 billion.

Ilias Asimakopoulos, the chief executive of JT International Hellas, was quoted as saying the illegal cigarette trade had captured more than one-fifth of the local market; so about 4.7 billion illicit cigarettes were entering the Greek market every year.

Legislation that would impose standardized packaging on tobacco sold in Ireland is not fit for purpose, according to the smokers’ group Forest Eireann.

In a submission to the Oireachtas (parliamentary) Joint Committee on Health and Children, the group said that standardized packaging would not stop children smoking and could boost the illicit trade in cigarettes.

The group said the government should assess the impact of standardized packaging on smoking rates and the illicit trade in Australia before introducing similar legislation in Ireland.

“The case for plain packs is based on the fallacy that children are encouraged to smoke because of exposure to so-called glitzy or colourful packaging and that without branding far fewer children or young people would be tempted to start,” said John Mallon, spokesman for Forest Eireann.

“This argument is based not on fact but on speculation and conjecture.

“If the government really wants to protect children from smoking it should seek tougher enforcement of existing laws and focus on further education in schools.”

In its submission to the committee, which is about to conduct hearings to consider the Public Health (Standardised Packaging of Tobacco) Bill 2013, Forest Eireann argued that tobacco control studies failed to consider the unintended consequences of standardized packaging.

There was a wide body of expert international opinion that believed that counterfeiting could have a serious impact on public health and business, it said. Standardized packaging could put children at greater risk, not less, because criminals didn’t care who they sold to.

So the government had to address the concerns that people had about the impact of counterfeiting before proceeding with standardized packaging.

Failure to do so could have serious consequences for children and for adult consumers, especially those tempted to purchase counterfeit goods.

“Plain packaging has nothing to do with health and everything to do with the ‘denormalization’ of a legal product and the 1 million adults in Ireland who continue to smoke tobacco despite fierce opposition from anti-tobacco campaigners and politicians,” the group said in a press note.

“The dull, grotesque packaging envisaged by campaigners is a form of state-sponsored bullying designed to stigmatise the consumers of a legal product and denormalise a perfectly legitimate habit.”

“Ireland, like many other countries, continues to face a precarious financial situation.

“A global recession has resulted in a sharp drop in international trade, rising unemployment and slumping commodity prices.

“As a result many people are suffering profound hardship.

“Despite this the tobacco control industry wants government to devote precious parliamentary time introducing legislation for a policy for which there is no credible evidence that it will work.”

A workshop on cigarette smuggling is due to be held at the European Parliament tomorrow.

It has been organized by the Policy Department D on Budgetary Affairs and will be staged at the Altiero Spinelli Building from 9 a.m. until 12:30 p.m.

A draft program indicated that one of the sessions would see Hana Ross and Michal Stokłosa, “respectively the managing director and economist at the International Tobacco Control Research/American Cancer Society,” give an assessment of the co-operation agreement between the EU and the tobacco industry, an assessment of member states’ activities against cigarette smuggling in relation to the funds received from the agreement, and an assessment of a new EU strategy against cigarette smuggling.

The Finnish Grocery Trade Association believes that the recent falls in the domestic consumption of cigarettes and cigars are not down to the introduction of retail display bans in the country, according to an Esmerk Finnish News story.

Rather, it believes the falls are merely part of a long-term downward trend in tobacco use.

And the Finnish retail chain S Group agrees up to a point.

It has said that the introduction of display bans in the country has not affected the level of cigarette sales but has reduced cigar sales.

It believes that cigar sales have been affected because they are often the result of impulse purchases, and because consumers want to look at these products before buying them.

Lower tobacco product sales last year cost the Italian government €730 million in reduced taxes, according to a story in La Stampa quoting figures from the Federazione Italiana Tabaccai.

In the past 10 years, tobacco sales have shrunk by about 21 million kg; 10 million kg in the period 2011–2013 alone.

The Switzerland-based Oettinger Davidoff Group has created a new wholly owned subsidiary for the Spanish market—Davidoff of Geneve Iberia, according to a story in Expansion.

The setting-up of the new subsidiary followed the ending of a collaboration agreement with the Spanish distributor Proein.

The new unit will absorb Proein’s staff.

People breaking the UAE’s new anti-tobacco law face the risk of being fined from today, according to a Khaleej Times story.

Enforcement agencies across the emirates are expected to target people smoking in cars containing young people, people selling cigarettes to minors and people operating shisha joints in restricted areas.

Anyone caught smoking in a car with children present is liable to be fined AED500. A repeat offence will attract a fine of AED1,000.

Fines ranging from AED100,000 to AED1 million will be imposed on violators of tobacco prohibitions in commercial establishments.

However, the UAE’s anti-tobacco crusader believes most of the government bodies assigned to implement the regulations are only partly ready to get tough on violators.

The head of the National Tobacco Control Committee at the Ministry of Health, Dr. Wedad Al Maidoor, said the authorities might not be fully ready for enforcement of the tobacco bylaws today.

“I also don’t expect the enforcement to be strict initially,” she said.

South Korea’s National Health Insurance Service (NHIS) said yesterday that it would decide the details of its compensation suit against KT&G and other tobacco manufacturers at a board meeting on Jan. 24, according to a story in The Korea Times.

“The board will decide when to file the suit and how much it will seek in damages,” an NHIS official was quoted as saying. “If details are approved, the filing can take place as early as a day after the meeting.”

Given this, the NHIS’s legal action against local and foreign tobacco manufacturers is expected to take place earlier than had previously been expected.

Last month, NHIS President Kim Jong-dae said the NHIS would file a suit against tobacco companies to recover medical costs which it had incurred due to smoking-related diseases.

“Tobacco makers should be responsible for health insurance payments for smoke-related diseases, which stood at 1.69 trillion won in 2009,” he said.

Japan Tobacco Inc.’s domestic cigarette sales volume during December, at 10.4 billion, was increased by 1.1 percent on that of December 2012, 10.3 billion, according to preliminary figures issued by the company today. The December 2012 figure was down by 4.5 percent on that of December 2011.

Volume during April–December, at 89.7 billion, was up by 0.4 percent on that of April–December 2012, 89.4 billion, which was increased by 10.5 percent on that of April–December 2011.

JT’s market share stood at 61.4 percent in December, at 60.8 percent during April–December, and at 59.6 percent for the full year to the end of March.

JT’s domestic cigarette revenue during December, at ¥57.0 billion, was increased by 0.7 percent on its December 2012 revenue, ¥56.6 billion.

Revenue during April–December, at ¥492.1 billion, was more or less unchanged from that of April–December 2012, ¥492.0 billion.

JT’s consolidated financial results, which will include its domestic tobacco business performance for the third quarter to the end of December, are due to be announced on Jan. 30.

India’s tobacco and tobacco products exports are expected to have earned INR50 billion in the financial year to the end of March, 29 percent more than was earned during the year to the end of March 2013, according to a story in the most recent issue of the BBM Bommidala Group newsletter.

Despite this increase in exports, the Tobacco Board of India is concerned that tobacco farming is facing challenges thrown up by local anti-smoking campaigns and by India’s participation in the World Health Organization’s Framework Convention on Tobacco Control.

So the chairman of the board, Dr. K. Gopal, has promised growers and traders that technical assistance will be provided to help them produce tobacco whose quality compares with the best in the world.