A new report conducted by the Civil Society Legislative Advocacy Centre (CISLAC), in collaboration with Tax Justice Network Africa (TJNA), has exposed how the world’s major tobacco companies willingly contributing significantly to illicit financial flows (IFF) in Nigeria and other African countries.
Titled: ‘Tobacco Industry and Illicit Financial Flows in Africa’, the report profiles leading tobacco companies, their subsidiaries, corresponding domicile and revenue trends between 2010 and 2021 in South Africa, Malawi, Tanzania, Kenya, Nigeria, Cote d’Ivoire, Ghana, Egypt and Morocco.
On presenting the report to journalists in Abuja, executive director of CISLAC, Auwal Rafsanjani, highlights that while Nigerians keep dying of smoke-related diseases, the tobacco industry has been feeding money laundering and corruption in the country. Referring to 2020 data from the United Nations Conference on Trade and Development, Rafsanjani revealed ,that Africa is now losing over $88.6 billion to IFFs.
“We have to show the world the negative effects and manner in which tobacco companies are destroying the health of Africans, and at same time, promote corruption in the continent,” he said.
Meanwhile, sociologist and tobacco harm reduction expert, Gerry Stimson has been advising African countries to avoid disaster by moving away from tobacco farming towards a more sustainable crop, because tobacco harm reduction is here to stay.
Stimson was one of the presenters at the recent Global State of Tobacco Harm Reduction (GSTHR) report, Fighting The Last War: The WHO and International Tobacco Control, launched on the 27th October. An event aimed at drawing attention to, and challenge the direction of the COP9 which this year is being held virtually this month.
In response to a journalist’s comment about the fact that some African countries rely on tobacco production, Stimson warned that any tobacco-dependent countries which will delay moving away from the ‘green gold’ would have disastrous effects on their economies in a not so distant future from now.
“I know there are some countries in African such as Malawi that heavily rely on tobacco production. But by now, Malawi should be thinking about agricultural transformation. The question these countries that depend on tobacco should be considering is: What does the future of tobacco production look like for them?” he emphasized.
Malawi urged to consider switching to cannabis
Echoing the expert’s arguments, Malawi President Lazarus Chakwera recently urged the local tobacco industry to switch to high-growth crops like cannabis. The President’s comments were made during a state of the nation address in which he said that tobacco was expected to generate less than $200 million in 2021. The figure is roughly similar to the past two years but well below the annual earnings of previous years which used to top $350 million.
“The inconvenient truth … is that while Malawi has come a long way by relying on tobacco as our … largest single crop contributor to our GDP, this reliance is now seriously threatened by declining demand worldwide,” said Chakwera. “Clearly we need to diversify and grow other crops like cannabis, which was legalized last year for industrial and medicinal use,” he added.
Meanwhile, discussing the production the Sh1.5 billion oral nicotine pouches factory, BAT Kenya said that the local “less stringent” regulatory and taxation framework has been a key factor in a enabling the production for the new category products.
In 2020, BAT announced it was launching a new plant at an estimated cost of Sh2.5 billion, to start the production of nicotine pouches in Kenya. The plan was to trade under the Lyft brand and target the African market.
However, the country’s Ministry of Health, with the support of a number of civil society lobby groups such as International Institute for Legislative Affairs, had resisted the sales of the products, and announced a ban in October 2020. Less than two years later, following incessant lobbying by BAT and a number of tobacco harm reduction experts, nicotine pouches were back on the Kenyan market.
Meanwhile, BAT Kenya’s Managing director Crispin Achola says that a further investment of Sh1 billion in the plant, greatly depends on the regulatory atmosphere that local authorities are willing to provide. “We reiterate the need for a balanced excise framework and pragmatic regulatory environment that fully enables adult smokers to switch to scientifically-substantiated, reduced-risk alternatives,” said Achola as quoted by Business Daily.
He added that “an enabling environment” will further facilitate foreign investment into the country and therefore economic growth. Nicotine pouches attract Sh1,500 excise duty per kilogramme, as per the enforcement of Finance Act 2022, increased from Sh1,200 previously.
Countless studies to date have indicated the relative safety of nicotine pouches and their potential to help smokers quit cigarettes or at least reduce harm. A recent study commissioned and funded by BAT: “Assessment of biomarkers of exposure and potential harm, and physiological and subjective health measures in exclusive users of nicotine pouches and current, former and never smokers,” tested this hypothesis.
A research team consisting of a number of BAT employees, conducted a cross-sectional study in Sweden/Denmark, testing several recognised biomarkers of potential harm (BoPHs) linked to smoking among exclusive adult users of Velo and current/former/never smokers.
The results indicated that as compared with smokers, exclusive users of Velo NPs have significantly less exposure to tobacco toxicants and more favourable BoPHs.
Meanwhile, as more people are switching from cigarettes to safer nicotine alternatives, BAT has recently estimated that approximately 3.2 million new consumers have started using its non-combustible nicotine products including Velo NPs in the first nine months of the year. This brings the total number of users to about 21.5 million people.