Tag: Sri Lanka

  • Authorities Crack Down on Single Stick Sales

    Authorities Crack Down on Single Stick Sales

    Photo: Taco Tuinstra

    Authorities in Nigeria and Sri Lanka want to restrict sales of individual cigarettes to discourage smoking. Sales of single sticks are common in developing countries where many smokers are unable to afford packs.

    Nigeria’s Federal Competition and Consumer Protection Commission (FCCPC) says it will start confiscating cigarettes sold by the stick at the expiration of the moratorium given in the Tobacco Control Law, according to the Premium Times.

    Scheduled to come into effect by mid-2021, new rules require tobacco companies to sell cigarettes in sealed and tamper-proof packaging, allowing law enforcement to easily spot illegally opened packs.

    “Once it is tamper-proof, anybody who is selling by the sticks at that point is violating the law in a significant manner, and we will have absolutely no apologies in confiscating the products on their shelves,” said Babatunde Irukera, executive vice chairman of the FCCPC.

    Sri Lanka, too, is drafting legislation banning the retail sale of individual cigarettes, reports News 1st, citing the country’s National Authority on Tobacco and Alcohol (NATA).

    “By drafting regulations to ban the retail sale of [single] cigarettes, those who cannot quit the habit of smoking will be compelled to purchase a full packet of cigarettes, which will contain 20 per pack,” said NATA Chairman Samadhi Rajapaksa. “Thereby, buying capacity will reduce, meaning, the tendency for smoking in the country could be brought down drastically by imposing a ban on retail sale of [single] cigarettes.”

    Rajapaksa noted that about 110 people die daily due to the consumption of tobacco and alcohol in Sri Lanka. He also stated that consumers spend close to LKR1billion ($5.2 million) on tobacco and liquor daily.

  • Ceylon Tobacco Co. Appoints New Chairman

    Ceylon Tobacco Co. Appoints New Chairman

    Illustration: Skypixel | Dreamstime.com

    Ceylon Tobacco Co. (CTC) has appointed Suresh Kumar Shah as its chairman, reports The Daily Mirror. He succeeds William Francis Pegel, who served as chairman from August 2019.

    The succession follows changes to CTC’s board announced on Feb. 1, with the appointment of three new nonexecutive directors—Suresh Kumar Shah, Stuart Kidd and Rumana Rahman—bringing the number of directors on CTC’s board to eight. 

    Previously, Shah served as chairman of the Ceylon Chamber of Commerce and chairman of the Employers Federation of Ceylon. 

    He also served as Commissioner on the Securities and Exchange Commission of Sri Lanka and was a member of the Monetary Policy Consultative Committee with the Central Bank of Sri Lanka and of the Council at the University of Moratuwa.

    Currently, British American Tobacco’s (BAT) regional head of finance for Asia-Pacific and the Middle East, Kidd joined BAT Australia in 2001. He has held various senior finance roles in New Zealand, Vietnam, the United Kingdom, Switzerland, Hong Kong and Japan. Prior to his appointment as regional head of finance, he was finance director at BAT Japan from 2015. 

    Rahman is BAT’s regional head of talent, culture and inclusion for Asia-Pacific and the Middle East. She is the first South Asian female and first Bangladeshi to sit on the regional leadership team and is also the first South Asian female leader of the top 120 leaders of BAT. 

    Prior to moving to Hong Kong, Rahman was the head of human resources for BAT Bangladesh. With more than 18 years of experience, she has an extensive background in human resources and specialist functions. Rahman was recognized as the most inspiring woman leader by Brand Forum in 2016.

  • Ceylon Sales Recover to Pre-Pandemic Levels

    Ceylon Sales Recover to Pre-Pandemic Levels

    Ceylon Tobacco (CTC) said that cigarette sales are recovering to pre-pandemic levels following a 38 percent decline in sales during the second quarter of 2020.

    CTC revenue for the second quarter of 2020 declined by 35.2 percent from the second quarter of 2019 to LKR5.53 billion ($30 million), while profits for the quarter dropped by 33 percent to LKR3.10 billion.

    CTC’s sales were impacted due to product access restrictions faced by consumers and retailers because of the island-wide curfew imposed to contain the Covid-19 pandemic from late Mach to mid-May.

    “Post June, the business recovery is reverting to nearly pre-Covid-19 levels encouragingly faster than anticipated, and the business is cautiously optimistic of the future in anticipation of revival of the economy,” a CTC spokesperson said.

    British American Tobacco holds 84.13 percent of CTC’s shares, with Philip Morris International accounting for an 8.32 percent stake.

  • Applied arts

    Applied arts

    Sri Lanka’s Center for Combating Tobacco (CCT) plans to launch an app that will allow the public to monitor the activities of the tobacco industry, according to a story in The Island quoting a CCT press release.

    CCT was established by the Faculty of Medicine, University of Colombo, in collaboration with the World Health Organization’s country office Sri Lanka and the National Authority on Tobacco and Alcohol (NATA).

    The CCT said the free Tobacco Unmasked HotSpots app allowed the reporting via a mobile phone of any tobacco-industry activities that promoted tobacco use, such as sales of tobacco products to the under aged and employing mobile or temporary selling points.

    The public, the CCT said, may report activities undertaken to manipulate the policy making/implementation processes related to tobacco control.

    And it may report media campaigns promoting arguments that favor the tobacco industry.

    The plan is that the public’s input will be used to construct an online map showing the current patterns and trends in tobacco industry activities around the island.

    The CCT said that the WHO’s Framework Convention on Tobacco Control called on signatory countries to protect their tobacco-related health policies from the commercial and other vested interests of the tobacco industry in accordance with national law.

    It said the first step in fulfilling such an obligation was to monitor the activities of the tobacco industry.

  • Nightmare scenario

    Nightmare scenario

    In Sri Lanka, the Vavuniya South Tamil Pradeshiya Sabha (the town of Vavuniya’s local authority) has banned the sale of cigarettes in areas which fall under its purview, according to a story in The Times.

    The ban was brought in on March 1 after a proposal to this effect was unanimously approved by the members of the Pradeshiya Sabha (legislative body that presides over the third-tier municipality).

    Meanwhile, the Vavuniya South Sinhala Pradeshiya Sabha was said to have mostly implemented a similar ban in areas under its purview.

    The sale of cigarettes in Vavuniya was said to have dropped by 78 percent by October last year as a result of the ban.

  • Tobacco firms accused

    Tobacco firms accused

    Sri Lanka’s Health Minister Dr. Rajitha Senaratne yesterday accused some locally-based tobacco companies of being involved in a ‘racket to mislead the public on the use of cigarettes in the country,’ according to a story in The Colombo Gazette.

    Senaratne said that some companies were importing illicit cigarettes and distributing them in the market to give the impression that there was a high number of people smoking cigarettes in the country.

    He said that Sri Lanka had implemented nine out of the 10 recommendations of the World Health Organization (WHO) on limiting the use of cigarette use in the country.

    The Minister said also that taxes on cigarettes had been increased to discourage their use.

    It wasn’t clear from the story whether the minister believed that tobacco companies were using the illegal trade to promote, say, the normalization of smoking within society; or whether such promotion was a side-line of the money-making scheme that is the illegal trade.

  • Sri Lanka survey proposed

    Sri Lanka survey proposed

    Sri Lanka’s National Authority of Tobacco and Alcohol is due to conduct an island-wide survey on tobacco smoking, according to a News 1st story.

    The survey will be conducted together with the World Health Organization and the US Center for Disease Control and Prevention.

    The story said that a lack of accurate statistics on smoking had created obstacles to implementing programs to control the habit.

    Nevertheless, a survey of school children that was conducted last year found that there had been a 50 percent decrease in the incidence of smoking among these young people from 2017 to 2018.

    The idea that Sri Lanka does not have the information necessary to implement programs to control tobacco consumption seems at odds with the evidence.

    According a report last year at The Lanka Business Online, the Government is planning to ban from 2020 tobacco cultivation and the importation of ‘cigarettes and tobacco’.

    Depending on the interpretation of the word ‘tobacco’ here, the country could be moving towards prohibition, with or without the necessary information.

    Meanwhile, news of the proposed survey follows hard on the heels of a new report that found the Government might have ‘lost’ Rs18 billion in cigarette tax revenue with a record, estimated 583 million illicit cigarettes having been smuggled into the country during 2017.

    The surge in illicit cigarettes was said to have been driven by high taxes and the absence of a proper mechanism to combat illicit-cigarette inflows.

    The report, A baseline study on the illicit cigarette market with the resulting tax implications for Sri Lanka, was co-authored by a group of academics comprising Dr. S.N. Morais, Prof. S.S. Colombage and Dr. C.N. Wickramasinghe, and funded by an unnamed ‘private consultancy firm’.

  • Surge in illicit cigarettes

    Surge in illicit cigarettes

    The Government of Sri Lanka might have ‘lost’ Rs18 billion in cigarette tax revenue with a record, estimated 583 million illicit cigarettes having been smuggled into the country during 2017, according to a story in The Daily Mirror citing the findings of a new report.

    The surge in illicit cigarettes was said to have been driven by high taxes and the absence of a proper mechanism to combat illicit-cigarette inflows.

    The report, A Baseline Study on the Illicit Cigarette Market With the Resulting Tax Implications for Sri Lanka, was co-authored by a group of academics comprising Dr. S.N. Morais, Prof. S.S. Colombage and Dr. C.N. Wickramasinghe, and funded by an unnamed ‘private consultancy firm’.

    Morais said that Sri Lanka was becoming a hotspot for illicit cigarettes, which accounted for more than 15 percent of cigarette consumption in Sri Lanka, while Colombage added that a lower-than-projected revenue from cigarette taxes was an indicator of the existence of a massive illicit market. According to him, the realized budget revenue from cigarette taxes was 3.3 percent lower than had been forecast for most of the years between 2009 and 2017. “It is noteworthy that the actual value was lower than the forecast value in six out of nine years, indicating the existence of illicit trade,” he said.

    And he said that tax increases alone would not bring down cigarette consumption in Sri Lanka. “Although the weighted average excise tax rate rose by 192 percent, the sales of cigarettes declined only by 26 percent during the period 2010-2017,” he said.

    “Even the small reduction cannot be regarded as a decline in the overall smoking prevalence in the country, as smokers may have shifted to the illicit cigarette market, thereby offsetting the fall in legitimate cigarette sales.”

    Wickramasinghe said that illicit cigarette consumption was high among migrant communities and low-income consumers.

    In some places, the price of an illicit cigarette was 30 percent lower than that of a licit cigarette. However, in other locations, certain illicit brands were sold at a premium.

    Illicit cigarettes were sold also by mixing them with licit cigarettes, while charging the standard price. This happened because it was difficult for the average smoker to differentiate cigarettes by appearance, though there were differences in taste. In such cases, the traders earned higher profits because cheap, untaxed cigarettes could be sold at higher prices.

    Wickramasinghe pointed out that illicit cigarettes were smuggled into Sri Lanka to meet the demand created by migrant communities for cigarettes produced in their home countries. “These migrant communities have special distribution networks and large quantities of illicit cigarettes are reportedly marketed using online platforms operated in their languages,” he said.

  • Cigarette sales stopped

    Cigarette sales stopped

    One hundred cities in Sri Lanka have stopped selling cigarettes, according to a story in the Colombo Page relayed by the TMA.
    Speaking before the 83rd Annual General Meeting of the Public Health Inspector’s Union of Sri Lanka on Sunday, the Minister of Health, Nutrition and Indigenous Medicine, Dr. Rajitha Senaratne, said about 100 cities in the country had stopped selling cigarettes, and that that number was expected to double during the next year.
    It was not clear what was meant by a ‘city’, and it was unclear whether all the 100 cities had stopped selling cigarettes, had simply stopped promoting them or had taken some other actions.
    The story said that Senaratne had asked cities [presumably city authorities and retailers] not to promote cigarettes and tobacco sales.
    And Senaratne was quoted as saying that some cities had stopped selling tobacco products altogether.
    Some cities were said to ‘advertise’ that they were entirely free of alcohol and cigarettes.
    According to the World Health Organization’s Framework Convention on Tobacco Control, Sri Lanka was the only country that had taken such measures, the story said.

  • Banning tobacco

    Banning tobacco

    A recent meeting in Sri Lanka tried to sell the idea of switching tobacco growers to ‘alternative’ crops. Something needs to be done because the Government is planning to ban tobacco cultivation from 2020.
    According to a story in The Lanka Business Online, also from 2020, the Government plans to ban the importation of ‘cigarettes and tobacco’. If tobacco here refers to leaf tobacco, then the country is moving towards prohibition and the repercussions could be enormous.
    Sri Lankan consumers’ annual expenditure on cigarettes and tobacco is higher than the annual export revenue the country earns through the EU GSP Plus, according to the Lanka Business story quoting the Industry and Commerce Minister Rishad Bathiudeen. The EU GSP (European Union Generalised Scheme of Preferences) helps developing countries export their products to the EU.
    “Reports say that Sri Lankan consumers spend more than Rs200 million per day for cigarettes,” Bathiudeen was quoted as saying.
    “According to the World Health Organization, in 2015 the direct and indirect cost of tobacco use in Sri Lanka was estimated at Rs89 billion or US$662 million.”
    Bathiudeen was addressing the launch event of the tobacco farmer research report titled Farmer Perspectives on Proposed Tobacco Growing Ban and Opportunity to Diversify, by Dr. Chatura Rodrigo of Green Space Consultancies.
    “We annually spend more than $660 million for tobacco use and resulting expenses,” said Bathiudeen. “When we compare this $660 million with some other important values we can understand the huge cost for the economy from tobacco use.
    “Sri Lanka’s annual expenditure on tobacco use is even higher than the additional export income from EU GSP Plus, which is around $480 million.”
    Bathiudeen said the Government was therefore making attempts to switch the tobacco economy to a more productive livelihood stream comprising alternative, export-driven crops.
    Currently, Lanka Business said, more than 3,300 tons of tobacco was reportedly produced in Sri Lanka on 0.07 percent of the country’s agricultural lands.
    An expert tobacco panel at the event indicated that tobacco was considered to be an industrial crop, rather than a commercial crop. Since the bulk of the harvest was used for nicotine products, it ended up in industrial/machine processing, unlike many other commercial crops.
    Among all types of full-time farmers in Sri Lanka, tobacco growers are some of the most profitable, earning regular margins of 20 percent or higher.