- New figures reveal worldwide profits but big companies insist they are not switching to emerging markets to avoid regulation
Much of this profit is ultimately channelled to pension and insurance investors in the UK – British American Tobacco and Imperial are two of the largest companies listed on the London stock market.
London's role as a hub of the multinational tobacco trade is in part a legacy of the British empire. While BAT sells very few cigarettes in the UK, for example, it is a big player in many emerging economies. In Turkey it sells Viceroy and Pall Mall brands; its Kent cigarettes are big sellers in Russia, while Gold Flake and John Player Gold Leaf are popular in Pakistan. Rothmans in Nigeria and Kent and Montana in Iran are also important for BAT. India, Vietnam, Bangladesh, Iraq, Egypt and Yemen are also promising markets for the company.
The big four tobacco firms – Philip Morris, BAT, Imperial and Japan Tobacco – insist they do not recruit new smokers in developing countries; rather, they grow sales by converting existing smokers of local tobacco products to their stable of aspirational Western brands – often "safer" products, they say.
A British American Tobacco spokesperson said: "There is constant speculation that we're breaking into emerging markets to avoid regulation. But this is not true. We didn't invent smoking, nor 'export' it anywhere, and we have been in many of these developing markets for hundreds of years – in the case of Africa, India and Brazil, since the early 1900s.
"As disposable income grows around the world, particularly in developing countries, more smokers are upgrading to premium brands rather than low quality local alternatives – and this doesn't just apply to cigarettes."
And yet almost 80% of the 6 million people killed last year by tobacco-related illnesses were from low- and middle-income countries, according to new research from health lobby campaigners.
The study identified tobacco as the No 1 killer in China, where smoking is said to cause 1.2 million deaths annually. It is also blamed for more than a third of male deaths in Kazakhstan and in Turkey – other major smoking nations.
China accounts for about 40% of the global market for tobacco. The big four western firms have been eager to gain a foothold, but the industry remains firmly in state control.
The New Tobacco Atlas – produced by the World Lung Foundation and the American Cancer Society and published in Singapore at the World Conference on Tobacco or Health – found that tobacco-related deaths had tripled in the last decade: they now account for more than 15% of male deaths and 7% of female deaths.
The study indicated cigarettes had become an average of 21.7% more affordable in low and middle-income countries.
Health campaigners insist the industry is in fact lobbying hard to block international standards on tobacco control. "The tobacco industry thrives on ignorance of the true harms of tobacco and using misinformation to subvert health policies that could save millions," said Peter Baldini, chief executive of the World Lung Foundation.
Simon Bowers
