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Proceedings INGCAT International NGO MObilisation Meeting Geneva, 15-16 May, 1999.

Tobacco and Poverty
Mary Assunta
Media Officer, Consumers Associatio of Penang, Malaysia.

In 1971, the British Medical Journal published an editorial about the 2nd World Conference on Smoking and Health and the editorial issued a warning. 'There is a real danger in this deadly habit being exported to the younger countries of Africa and Asia, and the rest of the world has a responsibility to see that this is not done. We have already produced millions of slaves to cigarettes in our own land. To export the slavery to the developing countries would be very wrong." Today, after almost 30 years, it is clear that this slavery has indeed been successfully transported to developing countries where millions are now enslaved in its poverty, diseases and death. Of the 1.2 billion smokers in the world today, the majority, 800 million, are in developing countries. The truth about tobacco is that countries where consumption is growing the fastest are also among the world's poorest. The living standards of the developing countries of these 800 million smokers tell us that the effects of smoking will be far worse. Nearly three-fifths of the population lack access to sanitation, a third have no access to clean water, a quarter do not have adequate housing, and a fifth have no access to modern health services of any kind. 850 million people are illiterate, 2 billion children are anemic, about 17 million people in developing countries die each year from curable infections and parasitic diseases. And come 2030, a greater fate is awaiting the poor people from the developing world I where we now know that 7 million are projected to die from tobacco use.

Ladies and gentlemen, while the per capita consumption of tobacco fell by about 10% from 1970 to 1990 in developed countries, it increased by about 64% in developing countries during the same period. And per capita consumption has more than doubled in countries such as Haiti, Indonesia, Nepal, Senegal and Syria, while it has 'tripled in the Cameroon and China. China's increase in tobacco consumption has been the most dramatic. Sixty-one percent of Chinese men smoke, which means that China alone accounts for 300 million smokers, about the same number as in all the developed countries combined. Tobacco may eventually kill about 50 million of all of the children alive today in China.

Most developing countries spend far more foreign exchange on tobacco imports than they gain in tobacco exports. Even for those countries that do export a significant mount of tobacco, most of the profits from the global trade go to the multinational tobacco corporations rather than to the developing countries' treasuries. Philip Morris, RJ Reynolds and British American Tobacco, the world's largest non-state multinational tobacco companies now own or lease plants in at least 50 countries. And in 1997, these three companies had combined revenue of more than $65 billion, a sum greater than the GDP of Costa Rica, Lithuania, Senegal, Sri Lanka, Uganda and Zimbabwe combined. Tobacco transnationals are notorious for using aggressive advertising and promotional tactics not allowed at home. Malaysia, for example, has now come to be known as the world capital of indirect advertising.

Effects of smoking are devastating on developing countries. There are 1.3 billion People in developing countries.

Living on less than one dollar per day. Smoking makes them even poorer. Cigarettes can cost a smoker about 25% of his income Smoking two packs a day can siphon off about 30% or using tobacco of a poor man's income income in Malaysia. A poor man in China can spend up to 60% of his income on cigarettes. Of course this takes away income badly needed for more basic needs for the family. And should he become incapacitated, he loses the ability to bring in the income; should he die due to a smoking-related disease, his, family loses their breadwinner altogether.

The burden of smoking on government is great. Tobacco costs governments money treating tobacco- related diseases, which their limited health budgets cannot meet. The statistics speak for themselves. For example, costs in Guatemala are $800 million, in Costa Rate $534 million and India $8 billion, In 1993 alone, China gained about $5 billion in cigarette taxes, but then lost $8 billion in productivity and health care It costs. The amount spent on tobacco in poor countries exceeds 'what is spent on health care and education.

Vietnam has a GNP per capita of $290 and most of its people earn less than $1 a day. Its annual expenditure on cigarettes represented six times the amount spend on health care and twice the amount spent on education.

Ladies and gentlemen, we know that 80% of those who start smoking do so before the age of twenty, and this is quite consistent across .the globe. However, we must see the problem in a different context when considering children from poor countries who already have a disadvantage start in life and will probably continue in this disadvantage well into adult life. Many of the children who start smoking or using tobacco in poor countries are already malnourished, underweight or wasting. In Pakistan, there are" about 1,200 children who take up smoking every day. Pakistan's government spends I% of its budget on health, 2% on education. Fifty-one percent of Pakistani children do not have enough to eat, or are moderately to severely underweight. We can see the problems that tobacco. Will reap in Pakistan in the years to come.

It is these children that companies such as BAT hook into a lifetime of addiction and suffering through lies and deception. In India, 92% of its children are underweight and wasting, yet each day, 55,000 children in India start using tobacco. And about 5 million children under the age of 15 are already addicted to tobacco. Now although cigarettes form about 20% of India's market, the transnational cigarette companies are engaged in an aggre1sive campaign to capture and convert India's 250 million tobacco users, particularly the young. And tobacco use is growing at the rate of about 5-7% in India and what is India's health budget? 1% of national budget, which is no match to handle the carnage of the tobacco-related diseases that are upon its poor. Similarly in other countries, such as Cambodia, Vietnam, Indonesia and Nepal, more than half of their children are underweight and wasting, and many of these are entrapping themselves in tobacco addiction early in life. It is also apparent that governments, health workers, social organisations and children's organisations have not fully realised the wide impact of smoking on these children. We must now include tobacco control activities as an important aspect of health education and improving public health.

The problem is further complicated when you have poor children in many developing countries directly involved in the tobacco business so that they and their families can just eat for that day. They either sell cigarettes or are involved in its cultivation. In India, children are employed at 35 cents a day to roll bidis, and now I hear bidis are exported to the US. It is becoming fashionable for the rebellious young American kids to now smoke bidis.

Tobacco transnationals are turning to developing countries not only to expand their markets but for a source of less expensive tobacco. One reason for low prices is that much of the direct and indirect cost is absorbed by the farmers, their families and the environment in southern countries. Tobacco farmers in developing countries are poor and their cultivation is usually carried out on small-scale farms of less than one acre. This is on fertile land that can sustain food crops. tobacco cultivation is not as lucrative a crop as it is often made out to be. The lion's share of the profits go to the companies and not to the farmers. Tobacco cultivation therefore usurp the place of food crops. Land under tobacco cultivation worldwide is estimated to be able to feed about 10 to 12 million people. As a result, governments and people have to bear the burden of the higher cost of imported food.

In Kenya, food production in tobacco growing districts has decreased as farmers have shifted from food crops to tobacco. However, the net income from tobacco is less than what the farmers would earn from food crops. BAT is the largest agribusiness company in Kenya contracting some 17,000 farmers to cultivate tobacco over an estimated 15,000 hectares of fertile agricultural land, but what those farmers earn is not enough to buy sufficient food for the family. Tobacco cultivation is labout intensive and capital intensive. It requires about 1,200 labour hours per acre, compared to maize, which only takes about 107 hours. A survey done by UNICEF in one tobacco growing district in Kenya reports that 52% of the children in that district either suffer from chronic or acute malnutrition, or are underweight.

The situation is similar for Brazil, as well. Today, Brazil is the world's largest exporter of tobacco, exporters more tobacco to the US than any other country. Brazilian tobacco is primarily used by Philip Morris and other transnationals to make less expensive brands that cost only half that of American tobacco. But life for Brazil's tobacco farmers is difficult and riddled with debt and ill health.

Governments of developing countries should also take responsibility for supporting and promoting tobacco cultivation, for running state tobacco monopolies, for allowing 'tobacco transnationals to flood our markets and not giving smoking the priority it deserves as it, continues to ravage our people. The answer to the question. "who will produce tomorrow's American, British and Japanese cigarettes" is quite clear. The Marlboro Man and Joe Camel are now riding cheaply out from factories in developing countries to meet, international markets. Like in many other international companies, the: tobacco transnationals are not only good at securing markets among developing countries but also shifting production overseas. Tobacco transnationals such as Philip Morris, RJ Reynolds and BAT have all started production in many Asian countries. For example, in Vietnam in 1997, RJ Reynolds' local venture sold $1 million worth of cigarettes to Canada and Germany. Vietnam's poverty makes it a prime target for foreign tobacco companies looking for countries; with cheap labour and available land to produce tobacco. Ironically, the locals consider this an advantage and welcome the employment opportunities for its poor. Damon Incorporated, one of r the world's largest tobacco leaf dealers was one of the first foreign companies to open an office in Vietnam, and it now develops new crop varieties for what it hopes to be a growing market. The local manager is clear about why Vietnam was selected by this company. "Because of (heap labour, Vietnam can sell the majority of its tobacco for less than $3 per kilo. We will be extremely competitive. Tobacco is a fairly stable commodity. Come boom, come bust, there will always be smokers:

Ladies and gentlemen, liberalisation of trade is certainly not good news for the smoking epidemic in developing countries. In India, previously formed tobacco companies could only enter the country through joint ventures and had to export at least half of their production. The Indian government has Ii relaxed this ruling, and since August of 1998, multi-national corporations have a 100% ownership of I several manufacturing plants in the country. Market predictions are that the transnationals will initially. operate through joint ventures and licensing arrangements with the Indian companies but will eventually take over the market completely, much as they have done in other countries. Similarly, tobacco transnationals forced their way into the Chinese market in 1998, in exchange for admitting China into the WTO. Fighting tobacco requires resources, which of course seem to be a never ending problem among third world governments and NGO. In fact it appears that we should be fighting poverty first. The world has more than enough resources to accelerate progress in human development for all and to eradicate the worst forms of poverty. It has been estimated that the total yearly investment required to achieve universal access to basic social services would be approximately $40 billion, or 1% of world income, and that should cover costs for basic education, health, nutrition, productive health, family planning, safe water and sanitation. The resources are available but perhaps not channeled for tobacco control and human development:

• While provision of basic education for all would require $6 billion, $8 billion is spent on cosmetics in the US;
  
• While water and sanitation for all would require $9 I billion, Europeans spend $11 billion on ice cream:
  
• While reproductive health for all women would cost $12 billion, Europeans and Americans spend $12 billion on perfumes.
  
• While basic health needs could be provided for $13 billion, people spend $17 billion on pet food in the US and Europe.