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Tag: Indonesia

  • CORESTA Launches Website for Upcoming Conference

    CORESTA Launches Website for Upcoming Conference

    Yesterday (July 1), CORESTA (Cooperation Centre for Scientific Research Relative to Tobacco) launched its website and published its program for its upcoming Agronomy & Leaf Integrity and Phytopathology & Genetics Conference that will be held from September 28 to October 2 in Surabaya, East Java, Indonesia.

    “We are dedicated to providing an excellent event that fosters scientific discussion and offers a wonderful introduction to and experience in Asia,” conference chair Carlos Eduardo Pulcinelli said. “Asia was chosen as the host continent for this conference due to the region’s significant role in tobacco cultivation, as well as to support the many young researchers from this part of the world who are committed to advancing tobacco science.”Click here for more information, registration, and paper submissions.

  • Young Asians Moving from Cigarettes to Vape

    Young Asians Moving from Cigarettes to Vape

    Young people in Southeast Asia are moving from smoking cigarettes to vaping and heated tobacco products (HTPs) instead, a survey of consumer research and data analytics from Milieu Insight said. It surveyed more than 18,000 legal-age adults across Singapore, Malaysia, Vietnam, the Philippines, and Indonesia, studying their consumption trends, flavor preferences, purchase channels, reasons for use, and future adoption.

    “The study shows some key factors influencing this trend,” said Gerald Ang, Milieu Insight’s chief operating officer. “One key factor is the variety of flavor, with fruit and menthol flavor dominating consumer choice in alternative nicotine products.

    “E-cigarettes and heated tobacco products being ‘cheaper’ is also an important reason for using alternative nicotine products.”

    Even though Singapore has banned the use of alternative nicotine products, they are still prevalent among people aged 21 to 29, the survey found, with 7.8% in that age group use vapes and HTPs, while 5.7% smoke cigarettes. The study also found that in Singapore, 43% bought these products from online shopping and messaging platforms, 29% bought the alternative nicotine products from friends and family, and 19% bought them on social media platforms.

    Ang said the study shows that e-cigarette and HTP use in the region is expected to grow, as a sizeable portion of smokers indicated that they were likely to use alternative nicotine products in the next six months.

    In Vietnam, which has also banned these alternative nicotine products, 9.2% of people in the 25 to 34 age bracket are vaping. And in Malaysia, 14.8% of young people between 20 and 29 are using e-cigarettes and HTPs.

  • Tobacco Workers to Protest in Jakarta

    Tobacco Workers to Protest in Jakarta

    Photo: Taco Tuinstra

    Tobacco workers represented by the Federation of Tobacco Cigarette Food Beverage Trade Unions planned to protest outside the Ministry of Health in Jakarta today to denounce a proposed government regulation of tobacco sales.

    Security risk management consultancy Crisis24 anticipated “hundreds” of participants and warned of the possibility of transport disruptions and minor clashes with police.  

    Indonesian lawmakers have been reevaluating the country’s tobacco control laws, including those on packaging.

    In September, more than 20 industry organizations signed a joint statement against plans to require plain packaging for tobacco and vaping products. The signatories included groups representing manufacturers, tobacco and clove farmers, labor unions, traders/retailers, creative industries, broadcasters and advertisers.

  • KT&G Steps up Investment in Indonesia

    KT&G Steps up Investment in Indonesia

    Photo: KT&G

    KT&G will invest KRW600 billion ($454 million) and hire about 1,000 people in Indonesia. The company’s local operations will serve not only Indonesia but also the Middle East and other markets in the Asia-Pacific region.

    “KT&G chose Indonesia as the company’s center of production for the Asia-Pacific market,” KT&G Indonesia’s president director, Jeong Yun-sig, told JoongAng Daily. Indonesia is KT&G’s biggest market outside Korea, accounting for 22.6 percent of the tobacco company’s total exports as of 2023.

    KT&G entered Indonesia in 2011, when it bought a local tobacco company. As of 2023, the company had sold 9.55 billion cigarettes in the country, propelling it to the No. 4 spot among tobacco manufacturers in Indonesia, ahead of multinationals such as British American Tobacco and Japan Tobacco International.

     In April, KT&G broke ground for two additional Indonesian factories. Upon completion, company will have a production capacity in Indonesia of 35 billion cigarettes annually.

     “We have consistently invested in the Indonesian market, building a local R&D center and hiring experts for localization efforts,” Jeong Yun-sig said. “The localized version of Esse and new brands for the Indonesian market worked well for the company.”

  • Activists Slam Indonesia’s Failure to Raise Taxes

    Activists Slam Indonesia’s Failure to Raise Taxes

    Photo: Taco Tuinstra

    Indonesia’s decision to keep cigarette excise tax levels at 2024 levels next year has drawn fierce criticism from health advocates, reports The Jakarta Post.

    Hasbullah Thabrany, head of the National Committee on Tobacco Control, said the failure to increase taxes represents a major step backward in the effort to reduce tobacco consumption in the country.

    He noted that a previous 10 percent increase in cigarette tax had failed to decrease smoking rates among minors and low-income families.

    “Yet, despite that situation, the government decided not to raise the excise for next year,” Hasbullah said in a discussion on Thursday, 3 Oct 2024.

    On Jan. 1, Indonesia increased the tax on electronic cigarettes by 10 percent. In late 2022, the government announced an increase in taxes on machine-made clove cigarettes and white cigarettes of between 11 and 12 percent, as well as a 5 percent rise for hand-rolled cigarettes.

    Indonesia is in the Top-10 of countries with the highest smoking rates, according to the World Health Organization.

  • Indonesia Keeps Tax Rates

    Indonesia Keeps Tax Rates

    Photo: Taco Tuinstra

    Indonesia’s finance ministry confirmed that the country’s tobacco excise rate will remain unchanged for 2025, reports Tempo.

    “Pending the finalization of the 2025 State Budget, the government has decided to maintain the current policy,” said Askolani, director general of customs and excise at the finance ministry, during a press conference on Sept. 23.

    According to Askolani, the government will continue to explore alternative policy options, including potential price adjustments at the industry level, to discourage smoking. Furthermore, the government will evaluate the price discrepancies between the three main cigarette categories—hand-rolled kreteks, machine-made kreteks and “white cigarettes”—which have contributed to downtrading.

    As of Aug. 31, 2024, Indonesia has collected IDR138.4 trillion ($9.1 billion) in excise revenue, representing a year-on-year growth of 5 percent. This increase was fueled in part by increased production of hand-rolled kreteks and machine-made kreteks.

  • Indonesia Urged to Raise Tobacco Taxes

    Indonesia Urged to Raise Tobacco Taxes

    Photo: Taco Tuinstra

    An Indonesian health ministry official has recommended higher cigarette taxes to deter consumption, reports the Antara news agency. Cigarettes are cheaper and more easily accessible in Indonesia than they are in many comparable countries.

    “The urgency of increasing the excise is to prevent the public from easily obtaining cigarettes with a cheap price in Indonesia,” Benget Saragih, a member of the ministry’s working team for tobacco disease control, was quoted as saying.

    Nearly 38 percent of Indonesia’s 270 million people smoke—a much higher share than in neighboring countries such as Singapore. With this figure, Indonesia ranks 13th in the world in terms of cigarette consumption, Saragih said.

    The number of deaths caused by cigarette consumption has reached 8 million per year, according to Saragih. Seven million of the deaths are due to active smoking and the remaining 1.2 million due to passive smoking, he added.

  • Industry Groups Push Back on Plain Packaging

    Industry Groups Push Back on Plain Packaging

    Photo: Taco Tuinstra

    More than 20 industry organizations signed a joint statement against Indonesia’s plans to require plain packaging for tobacco and vaping products, reports The Jakarta Post. The signatories included groups representing manufacturers, tobacco and clove farmers, labor unions, traders/retailers, creative industries, broadcasters and advertisers.

    Franky Sibarani, vice chairman of the Indonesian employers’ association Apindo, noted that, given the significance of the tobacco business in Indonesia, the regulatory pressures were likely be felt in other sectors as well. The tobacco industry, he pointed out, supports millions of jobs, including farmers, workers, traders and retailers, along with professionals working in the creative industry.

    “Policymakers should be cautious in issuing regulations that could threaten prolonged contractions,” said Sibarani.

    Henry Najoan, chairman of the Indonesian kretek cigarette manufacturers association Gappri, emphasized that the tobacco industry is not just a business but a significant economic and cultural chain.

    “The proposal for plain packaging […] will have serious impacts, as it exacerbates already excessive policies and could lead to a contraction in state revenue and employment,” he said. “Therefore, we firmly reject this regulation.”

    Benny Wachjudi, chairman of the Indonesian white cigarette producers association Gaprindo, highlighted the tobacco industry’s contributions to the national economy. The industry, he said, accounts for up to 10 percent, or more than IDR200 trillion ($12.99 billion), of Indonesia’s annual excise duty collections. Plain packaging, Wachjudi warned, would boost the illicit cigarette trade.

    Kusnasi Mudi, secretary-general of the National Tobacco Farmers Association, noted that tobacco cultivation alone supports 2.5 million livelihoods in Indonesia. “Tobacco is one of the national strategic commodities, but our existence is continually suppressed,” he said. “We request government protection for the 2.5 million farmers who are also struggling for their livelihoods and facing various other issues.”

    Tutum Rahanta, chairman of the advisory council of the Indonesian Retailers and Shopping Center Tenants Association, said that the plain packaging proposals are impractical for all parties involved. “This regulation seriously undermines the tobacco industry at a time when the sector, from upstream to downstream, has adhered to previous regulations,” he said. “The government should focus on combating illegal cigarettes rather than interfering with legal cigarettes that comply with the law.”

    Fabianus Bernadi, chairman of the Indonesian outdoor media association AMLI, said the proposed legislation would significantly impact his members’ economic viability. A recent survey suggested that in some regions, the organization’s companies derived up to 79 percent of their business from tobacco products.

  • ‘Excessive Tax Hike Could Spur Illicit Trade’

    ‘Excessive Tax Hike Could Spur Illicit Trade’

    Photo: Taco Tuinstra

    Indonesia’s above-inflation tax hike could fuel illicit trade and depress government revenue collections, according to Apindo, a leading employers association, reports Tempo.

    To discourage smoking, the government last year approved a 10 percent increase in excise taxes on cigarettes for 2023–2024.

    Despite the tax hike, the number of cigarette factories has increased significantly in Indonesia. Data from the Directorate General of Customs and Excise revealed a surge from 1,214 factories in early 2022 to 1,723 factories in June 2024.

    Meanwhile, Statistics Indonesia (BPS) reported a 28.62 percent smoking rate among Indonesians aged 15 and above in 2023. The largest number of smokers was reportedly in the 35–39 age group at 35.21 percent while the youth group (15–19 years) had a rate of 9.62 percent. The Health Ministry’s 2023 Indonesian Health Survey found 70 million active smokers, including 7.4 percent aged 10–18 years.

  • Indonesia Tightens Tobacco Rules

    Indonesia Tightens Tobacco Rules

    Photo: Taco Tuinstra

    Indonesia has tightened controls on tobacco sales and distribution, according to The Jakarta Post.

    The new rules prohibit sales of cigarettes and electronic cigarettes to people under 21 and pregnant women. They also ban cigarette and e-cigarette sales within 200 meters of an educational institution as well as on digital platforms that do not have an age verification system. Retailers are also barred from selling individual cigarettes, and all machine-rolled cigarettes must be sold in packs of 20 cigarettes.

    Observers have previously noted that selling individual cigarettes tends to attract younger consumers, largely because they are sold without packages carrying warning labels and cost less up front.

    With more than one-third of Indonesian adults (35.4 percent) smoking, Indonesia ranks among the world’s largest cigarette markets, according to the World Health Organization. And bucking the global trend, where tobacco use among individuals aged 15 years and above is projected to drop to 18.1 percent in 2023, tobacco prevalence in Indonesia is expected to increase to 38.7 percent in 2030.