Multi-billion naira tobacco industry comes under fire

With 20 billion sticks of cigarette valued at N200bn being consumed annually in Nigeria, the tobacco industry is sure a money spinner. However, this may not be for long as anti-tobacco groups mount pressure on President Goodluck Jonathan to sign the National Tobacco Control Bill into law. ADEDEJI ADEMIGBUJI reports. 

The tobacco industry has been described as one of the most profitable in the world. According to a global industry analyst, Euromonitor International, the global cigarette market is valued at $611bn. To market their products, tobacco companies use their enormous wealth and influence both locally, regionally and globally to protect their investment. A stakeholder’s report made available to National Mirror by the British American Tobacco Nigeria (BATN), affirmed that BAT is the world’s second largest quoted tobacco group by market share with brands sold in more the 180 markets, and sales estimated at 708 billion cigarettes globally in 2010. This enormous output according to Euromonitor International is estimated to translate into a gross turnover of 4.84 billion euros for the tobacco giant in 2010. However, the tobacco company’s revenues may come under pressure in Nigeria if President Goodluck Jonathan bows to pressure to sign the National Tobacco Control Bill (NTCB), which has been passed by both the House of Representatives and the Senate. With increasing litigations against cigarette manufacturers, the bill is expected to enforce compliance with the World Health Organisation’s Framework Convention on Tobacco Control (FCTC), which Nigeria is a signatory to.

The bill was drafted by the former Minister of Health, Late Prof. Olikoye Ransome-Kuti.

Senator Olorunimbe Mamora later sponsored and presented the bill to the Senate in 2008. It passed the second reading in February 2009 and a Public Hearing was conducted on it on July 20 and 21, 2009.

According to The Environmental Rights Action/Friends of the Earth Nigeria (ERA/FoEN) shadow report, “After manipulations by BATN to stop the presentation of the bill to the Senate, the Senate Committee on Health eventually sent the bill back to the plenary in January 2011 and it was eventually passed into law on March 15, 2011.

The House of Representatives also passed the Senate version of the bill on May 31, 2011.

Some of the provisions in the bill are consistent with the key provisions of the FCTC and when the bill is eventually signed by the President of the Federal Republic of Nigeria, it would have successfully domesticated the FCTC in Nigeria.”

The bills when signed into law will punish anyone who promotes, advertises or smoke cigarette in public places among others.

Promotion of tobacco in bars will also attract huge punishment, such as imprisonment with an option of fine. Nigeria is part of the over 40 African countries that have signed the FCTC which forms a basis for NTCB.

As a result, antitobacco advocates insist that the country is obligated to adopt and implement effective legislation aimed at reducing tobacco use and tobacco smoke exposure.

The threat to tobacco industry came as a result of the rate at which consumption pattern continues to increase with the attendant health risks associated with smokers even though the revenues continue to sky rocket, and the industry continues to boom.

With the number of smoker declining in developed countries in the past two decades due to increased awareness about the dangers of smoking and stricter tobacco control measures including high-taxes on tobacco products, big tobacco multinationals have since turned their attention to Asia and Africa with high populations and lax tobacco control measures.

According to a document titled Tobacco Industry Profile – Africa Intended Uses of Report, made available to National Mirror “BAT’s regional structure was reorganised in January 2011 to increase efficiency across the company.

The regional restructuring merged the Africa and Middle East region with Eastern Europe markets.

Currently, BAT’s African operations are organised into four different areas.” One of the regional structures, includes Nigeria.

“West Africa area includes Nigeria, Cote d’Ivoire, Guinea, Cameroon, Senegal, Mali, Burkina Faso, Ghana, Mauritania and Sierra Leone.

Nigeria is the major operational centre for the area with two factories in Ibadan and Zaria and area offices in Lagos,” stated the report adding that, “in 2011, the region accounted for seven per cent of global cigarette sales by volume.

The number of cigarettes sold in …Africa has increased by six per cent over the past five years, from 384 billion cigarettes in 2007 to 408 billion sticks in 2011.”

The report stated further that, “in Sub- Saharan Africa, overall cigarette volume has remained level and only increased by 0.3 per cent in the last five years.

However, at least 26 countries in the region experienced a five per cent or more increase in cigarette volume over the last five years.

The top cigarette consuming countries are South Africa, Nigeria, and Kenya, consuming 47 per cent of the region’s cigarette retail volume in 2011.”

In order to meet regional demand, BATN invested $70m in the Ibadan factory in addition to the earlier $150m investment which was as stated in the Park Lane MoU to generate Foreign Direct Investment (FDI) into the country, generating thousands of direct and indirect employment in addition to paying taxes to the Nigerian government.

The actual growth of tobacco industry was 5.4 per cent between 2007 and 2011 while it is expected to rise to 6.2 per cent between 2011 and 2016.

National Mirror gathered that Nigeria produced 15.4 billion cigarettes in 2010 and imported 5.3 billion. An estimated 0.1 billion was exported while 20.3 billion was consumed locally.

The Executive Director of ERA, Mr. Akinbode Oluwafemi calculated while speaking with National Mirror that with the 20.3 billion pieces of cigarette consumed at an average price of N10 per stick, the total industry revenue stood at N200bn in 2010.

Beyond Nigeria, market analysts anticipate that a shift in demographics will continue to contribute to the overall smoking population increase in Africa.

By 2016, Euromonitor International predicts that there will be 91 million more adults in the region and that cigarette sales will grow by 11 per cent over the next five years.

Meanwhile, multinational companies like BAT, Philip Morris International (PMI), Japan Tobacco International (JTI) and Imperial Tobacco Group (Imperial Tobacco) are increasing their dominance within Africa.

These four multinational companies increased their market share in the Middle East and Africa region by over 100 per cent in the last 10 years -- from 31 per cent in 2002 to 64 per cent in 2011. In 2006, African countries consumed an estimated 250 billion cigarettes, accounting for approximately four per cent of the total cigarettes consumed globally that year.

It was also revealed that Africa has a number of regional free trade blocs aimed at increasing economic development between members According to reports, the top cigarette consuming countries are South Africa, Nigeria, and Kenya, consuming 47 per cent of the region’s cigarette retail volume in 2011.

But if the bill is finally signed into law, the tobacco firms, especially BATN, which is a major investor in the industry, is expected to lose its huge revenue and investment but this is not a certainty.

Apart from BATN who dominates the market, JTI, (JTA) investment will also be threatened. JTI is the fourth largest tobacco company in the world and controls 10 percent of the global cigarette market.

It is the fifth largest in Africa and the Middle East in terms of retail sales volume. JTI sells cigarettes in 20 different African countries including Nigeria, South Africa, Tanzania, Algeria and Morocco and is actively expanding its presence in Africa through acquisitions. BATN has devised many strategies to foster a working relationship with host communities’ ad stakeholders through partnership and lobby.

The firm invested heavily on Corporate Sustainability Projects through the BATN Foundation.

Established 10 years ago, the Managing Director of BATN, Mrs. Beverley Spencer-Obatoyinbo, said in a statement to National Mirror, “The BATNF supports agricultural development and the reduction of poverty in Nigeria by providing sustainable means for communities to be self-reliant.”

But Akinbode believed otherwise. He said the Corporate Social Responsibility spree by the tobacco firm was a mere cajole and trick to kill more Nigerians with tobacco products.

As President Jonathan continues to delay the signing of the bill into law, the founder of ERA/FoEN, Mr. Nnimmo Bassey said, “After the overwhelming support the bill received in the Senate and House of Representatives, it is sad that till date, it has not been signed by the president.

The intervention of the health minister is a singular action that generations of Nigerians will not forget.

Giving Nigerians this gift as we mark the 2012 World No Tobacco Day will be remarkable,” But an industry source told National Mirror that the delay in signing the bill into law is not unconnected with the effects such move would have on the nation’s GDP.

With the huge revenue the tobacco industry is contributing to the national product output, the source maintained that the president’s is taking his time to consider so many factors before he would sign the bill such that the articulation of FDI policy would not be undermined.

National Mirror further gathered from a BATN source that if eventually the bill is signed, the tobacco giant would look for other options to boost its sales in a way that will not violate the provisions of the bill.

But he added that the firm is committed to ensuring the development of the communities where it operates.

BATN said it embarks on continual sustainable agricultural development that entrenches modern farming techniques among farmers.

SOURCE

Pass tobacco control bill

I write to call on the Senate Committee on Health led by Senator Iyabo Obasanjo -Bello and the leadership of the National Assembly to move immediately to pass the National Tobacco Control Bill 2009, sponsored by Senator Olorunnibe Mamoora. The bill, which enjoyed the support of many senators is yet to be returned to the Senate Plenary after a public hearing was conducted in July 2009.
It is a fact that there are dangers associated with smoking. The World Health organisation estimated that 5.4 million people die every year due to a tobacco related diseases. The majority of these deaths occurred in developing countries. Tobacco is the only consumer product that is guaranteed to kill half of its consumers if used according to manufacturers‘ intention. It contains more than 4,000 dangerous chemicals harmful to the body.
It is also a fact that stringent measures aimed at reducing smoking in Europe and America have driven the tobacco industry to developing countries like Nigeria.
Recent surveys suggested that more young people are becoming smokers every- day, while a survey conducted in Lagos hospitals reveals that two persons die each day from a tobacco related disease. Governments all over the world are putting measures in place to combat the epidemic through enactment of bills like the one Mamoora has proposed.
It will be to the credit of this National Assembly to expedite action on the bill and pass it before the expiration of this democratic dispensation. Nigeria played a major part in shaping global health policies especially in tobacco control. The world is watching and waiting. The National Assembly cannot afford to fail Nigerians.

Seun Akioye
1, Balogun Street, Off Awolowo Way, Ikeja, Lagos.

SOURCE

Group wants ban on sale of cigarettes near schools

By Ayodeji Moradeyo

The federal government should ban the sale of cigarettes near institutions of learning in the country, a non- governmental group, Campaign for Tobacco Free Youths, has said.
“It is highly wrong for cigarettes to be sold near school environment; government must do everything to ensure that our students are not exposed to seeing cigarettes being sold like biscuits,” the coordinator of the group, Gbenga Adejuwon, said.
Mr. Adejuwon, who spoke at a workshop organised in Akure, on Wednesday, also appealed to the governors of the 36 states of the federation to implement the article 8 of the Frame Work Convention on Tobacco Control of the World Health Organisation.
“The article, according to him, will also restrict the exposure to tobacco smoke to prevent hazards from second hand smoke,” he said.
Mr. Adejuwon also urged all states to set up tobacco control committees which will comprise government officials and tobacco control organizations.
The committee, he said, would be empowered by law to prosecute people who smoke cigarettes in public places.
The anti-tobacco activists present at the event also raised alarm over what they said was the attitude of tobacco companies to slow down the hearing of public health cases filed against them in courts by various anti tobacco groups.
“Most of these companies, through their counsels, asked for unnecessary adjournments to deliberately slow down the pace of judgement and frustrate the trials,” Mr. Adejuwon said.
The workshop was organized to inform students about the harmful effects of cigarette.

SOURCE

Nigeria, others criticize attempts to smuggle loopholes into WHO tobacco treaty

-Philip Morris International, British American Tobacco fingered

Non governmental organizations from across the globe, including Nigeria, on the platform of Corporate Accountability International and the Network for Accountability of Tobacco Transnationals (NATT) have released an exposé highlighting new tobacco industry tactics to undermine the implementation of the World Health Organisation Framework Convention on Tobacco Control (WHO FCTC).

The report comes at the midpoint of an eight-day negotiating meeting on a protocol to the WHO FCTC on illicit tobacco trade in Geneva, Switzerland, which commenced June 28, 2009, where tobacco giants such as Philip Morris International (PMI), British American Tobacco (BAT) and Japan Tobacco (JT) have a strong presence.

The document, produced by Corporate Accountability International and NATT, also criticizes FCTC Parties such as Lebanon and the Philippines for collaborating with tobacco corporations and falling short of commitments under the treaty.

FCTC Article 5.3 obligates treaty Parties to “protect [public health] policies from commercial and other vested interests of the tobacco industry in accordance with national law.” Guidelines for the implementation of this measure were adopted at the third Conference of Parties (COP3) last November in Durban, South Africa.

“In Durban, ratifying countries unanimously adopted rigorous guidelines to protect public health policy against tobacco industry interference,” explains Kathryn Mulvey, International Policy Director for Corporate Accountability International. “Now, the tobacco industry is trying to get governments to ignore their obligations under the treaty and make exceptions to these new rules. We urge the international community to reject the tobacco industry’s attempts to subvert the FCTC and derail the illicit trade protocol.”

“The heavy presence of the tobacco industry at the current negotiations and their surreptitious attempts to manipulate discussions on solutions to the illicit trade runs contrary to Article 5.3 provisions which discourage any form of cooperation between ratifying parties and the tobacco industry,” said Akinbode Oluwafemi, programme manager, Environmental Rights Action, and spokesperson of NATT.

The tobacco corporations and civil society do seem to agree about one thing: the protocol on illicit trade is precedent-setting. This is the first high-profile tobacco control issue to be taken on at the global level since last November, when three sets of implementation guidelines were adopted – on banning tobacco advertising, promotion and sponsorship; effective warning labels; and protecting against tobacco industry interference.

NGOs are calling on treaty Parties to follow through on their commitments. Meanwhile the tobacco lobby is present and visible at this week’s negotiations in full force, seeking to influence the content of the protocol to its own advantage and chip away at the safeguards of Article 5.3.

PMI has invited delegates to attend private meetings at the Intercontinental Hotel throughout the week. In contrast to the previous two negotiating sessions, this week the public gallery has been packed full of tobacco industry lobbyists. On Monday there were more than forty people in the gallery. Twenty-three of the twenty-eight people willing to identify themselves were from the tobacco industry, including twelve from BAT, seven from JT, one from Imperial Tobacco, and one from the Tobacco Institute of South Africa.

The Article 5.3 guidelines begin with the principle that ‘There is a fundamental and irreconcilable conflict between the tobacco industry’s interests and public health policy interests” (Principle 1) and urge Parties to avoid conflicts of interest for government officials and employees (Recommendation 4). Yet PMI reports meeting with 2,800 government agencies and 8,000 government employees to promote its system for tracking and tracing cigarette products.

Article 5.3 guidelines instruct ratifying countries to “Establish measures to limit interactions with the tobacco industry and ensure the transparency of those interactions that occur”. But last month Lebanon played host to BAT’s two-day conference on illicit trade, where Lebanese Minister of Finance Dr. Mohammed Shateh and other high-level public officials from the region reportedly met with BAT behind closed doors to discuss taxes, smuggling and other policy issues.

The guidelines also recommend that treaty Parties, “Reject partnerships and non-binding or non-enforceable agreements with the tobacco industry”. But last month Philippines customs authorities signed a Memorandum of Understanding with Philip Morris Philippines, through which the corporation will presumably gain access to law enforcement personnel and customs data. (This is the same corporation that was accused by Thailand two years ago of exploiting customs procedures and evading taxes by understating the value of exports.)

View the full report:

Clearing the Smoke-Filled Room: An Exposé on How the Tobacco Industry Attempts to Undermine the Global Tobacco Treaty and the Illicit Trade Protocol online.

ERA HAILS US TOBACCO BILL, URGES SENATE TO FOLLOW SUIT

The Environmental Rights Action/Friends of the Earth Nigeria (ERA/FoEN) has praised the United States government for passing a new tobacco control bill into law as it called on the National Assembly to expedite action on the National Tobacco Control Bill 2009, currently before the Senate Committee on Health .

President Barrack Obama has signed into law the new bill which empowers the US Food and Drug Administration (FDA) to exercise a large degree or regulation and control over manufacture, processing and sale of tobacco products in the US. The law empowers the FDA to limit nicotine levels, limit the use of flavours, restrict advertising in publications targeting young people, and banning outdoor tobacco advertising within 300metres radius of schools, among others.

It also requires tobacco companies to get FDA approval for new products and banned terms such as "light" or "mild" in tobacco packaging which imply a smaller risk to health, and introduce graphic new health warnings of packets.

ERA/FoEN, in a press statement in Lagos, said that with the Nigerian government no longer have any excuse not to immediately begin the implementation of the Framework Convention on Tobacco Control (FCTC) which it ratified in October 2005.

Programme Manager, Akinbode Oluwafemi, said the National Assembly should take a cue from last week’s signing into law of a major tobacco bill by President Barrack Obama and expedite works on the national Tobacco Control Bill and the lives of millions of Nigerians especially young children.

Oluwafemi said: “ It has become imperative for Nigeria to follow the good example of progressive countries all over the world as just demonstrated by United States President Barrack Obama in passing a strong tobacco control law that would protect Nigerians both smoker and non smokers alike.

“Governments across the world are taking effective measures to protect the health of citizens from corporations reckless desire for profits. Nigeria must act now,” he added.

The Nigeria Tobacco Control Bill sponsored by Senator Olorunnibe Mammora has passed the second reading in the senate. While referring the bill to the Senate committee on Health, Senate President, David Mark had admonished members to resist lobbying from tobacco industry. He said the Senate owe it a duty to the public health of Nigerians to pass the bill in two weeks .The bill when passed will help save lives of millions of Nigerians who may die from a tobacco related disease.

The bill seeks to ban tobacco advertising, selling cigarettes in single sticks, selling cigarettes within 1,000 meters radius of any school or playground, prohibition of smoking in public places and graphic warnings on cigarettes packs among others.