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From Africa Renewal, Vol.18 #3 (October 2004), page 4
'Golden leaf' loses its lustre
International tobacco controls spurring production shifts
By Naututu Okhoya and Gumisai Mutume
The growing global campaign against smoking poses a daunting challenge for Malawi, a country almost entirely dependent on tobacco for government revenue, employment and development financing. After the government, the tobacco industry is the second largest employer. It is responsible for 75 per cent of foreign earnings and contributes 10 per cent of the country's gross domestic product. The crop has been so eagerly embraced by farmers in the region that they call it the "golden leaf."
But in May 2003, world leaders agreed on the first global treaty to control tobacco. Suddenly, countries such as Malawi, Zimbabwe and Kenya had to begin reconsidering the sustainability of the sector. Tobacco is grown in more than 100 countries around the world and the sector employs about 33 million people. However, only a handful of developing countries, such as Malawi and Zimbabwe, are heavily dependent on the crop.
"We gambled that tobacco was going to be around longer," says Mr. Milton Kutengule, an official in Malawi's Finance Ministry. It was a long shot, and now the country is debating a turnaround. The government recently issued a draft economic strategy to encourage eventual diversification into alternative cash crops and the development of other sectors such as mining and tourism.
The decline of tobacco is a reflection of growing international concern that its health risks far outweigh its economic advantages for producing countries. Smoking is responsible for 4 million deaths annually. It is the world's leading preventable cause of death, with every second smoker dying from a tobacco-related illness. The World Health Organization (WHO) forecasts that 10 million people will die from smoking each year by 2020, and 70 per cent of them will be in poor countries.
Tobacco worker in Zimbabwe: Countries dependent on tobacco earnings will need time to shift to other crops.
Photo : ©Das Fotoarchiv / Frank Herman
"It is rare -- if not impossible -- to find examples in history that match tobacco's programmed trail of death and destruction," says former WHO Director-General Gro Harlem Brundtland. It is "programmed death," she says, because a cigarette is the only consumer product "which when used as directed kills its consumer." This year marks the 40th anniversary of the US surgeon general's 1964 report on cigarettes -- the first official recognition that tobacco smoking causes cancer and other serious diseases.
In sub-Saharan Africa, already ravaged by other health crises such as HIV/AIDS and where economies can barely support vital services such as health care, the added burden of smoking will further reduce life expectancy, the WHO warns.
Acknowledging these and similar arguments, African delegates joined their global counterparts at the 192-member WHO in 2003 to adopt the Framework Convention on Tobacco Control (FCTC). Once in force, the convention requires countries to ban or set tough restrictions on tobacco advertising, sponsorship and promotion within five years. So far, 118 nations have signed the convention. As soon as 40 countries ratify it, it will become law in those countries, and subsequently in other countries as they too ratify it.
The architects of the FCTC acknowledge that African tobacco-producing countries are faced with a complex problem. The convention includes mechanisms to provide long-term support for those countries in which tobacco farming is an economic lifeline, such as Zimbabwe and Malawi, WHO Executive Director Derek Yach told Africa Renewal. He says other institutions such as the World Bank and the European Union also offer assistance for diversification. Both organizations have urged producer countries "to reduce dependence, invest in rural development more broadly and they will get the support they need," he says.
Dr. Yach is concerned that at this point it is not money that is hampering progress in diversification, but a lack of political will, especially in countries where large multinational tobacco companies are influential. Ms. Karen Slama of the Paris-based International Union Against Tuberculosis and Lung Disease says tobacco companies provide large external investments and governments are grateful for new factories and jobs. But this creates a vicious cycle as greater demand for cigarettes is created within those countries.
Because of the impact of the anti-smoking lobby in industrial nations, tobacco companies are increasingly targeting developing countries. The WHO notes that this push into developing country markets results in part from increasing tobacco controls in industrial nations, including limits on advertising and the placement of health warnings on cigarette packages. As a result, while smoking is declining in high-income countries, it is on the rise among males in most low- and middle-income countries and among women worldwide, reports WHO.
Tobacco also happens to be a crop of choice for farmers in many poor countries, as it is easy to grow. Because it is essentially a weed, tobacco grows anywhere and thrives in marginal soils that yield little else.
It is also lucrative for national economies. In Zimbabwe and Malawi, tobacco earns about 7 times more than maize, 22 times more than cotton and 60 times more than sorghum. The Zimbabwe Tobacco Association argues that reduced tobacco production would lead to permanent job losses and lower government revenue. "Tobacco provides one of the most stable and effective cash crops for farmers," notes the International Tobacco Growers Association, a lobby group of manufacturers and farmers. "Without it, millions of farmers on marginal land would be reduced to subsistence production."
Nevertheless, the WHO argues that a majority of small-scale tobacco farmers in developing countries continue to live in poverty. In addition, says Ms. Catherine le Galès-Camus, a WHO assistant director-general, "Precarious labour conditions, including the use of child labour and exposure to highly toxic products, and a highly negative impact on the environment, make tobacco an issue inextricably linked to poverty and other development issues."
The World Bank is seeking to allay fears in developing countries that substituting other crops for tobacco would result in massive job losses. The claims about the negative effects of tobacco control have largely been generated by the tobacco industry and "have been greatly overstated," the Bank notes. In a study entitled The Economics of Tobacco Control, the Bank says that in all but a few agrarian countries there would be no net job losses, and there might even be job gains as money once spent on tobacco is shifted to other goods and services.
Anti-tobacco demonstration in Nigeria: Health concerns are increasing.
Photo : ©Global Partnership for Tobacco Control / Anna White
In any event, experts say, countries will have reasonable time to adjust and diversify, because implementing tobacco controls is a slow process and consumption and production will not cease immediately. "Even if the convention were remarkably successful and managed to hold consumption at current levels, there would be no decline in demand for tobacco," says Mr. Yussuf Salojee, director of the National Council Against Smoking in South Africa. WHO predicts that the number of smokers will rise from the current 1.1 billion people to 1.7 billion by 2025.
A study by South Africa's University of Cape Town notes that Zimbabwe already has a viable alternative to tobacco farming, horticulture (growing fruit, vegetables and flowers). The study, on the economic impact of tobacco control in Southern Africa, reports that roses provide economic returns 44 times higher than those from tobacco. Land under horticultural crops in Zimbabwe is growing. By 1990 the country was already ranked as the sixth largest rose exporter in the world. The main drawbacks, however, are that roses require larger investments to cultivate, transport and market than do tobacco.
Towards tobacco control
In support of the international campaign to reduce tobacco consumption, Dr. Yach urges African countries to raise taxes on and ban the promotion and advertising of tobacco products. He says countries that have done so steadily over the years have seen a rapid decline in smoking among youth and the poor -- who tend to be the majority of smokers in most African countries.
South Africa is considered a model for tobacco control on the continent. In 1990 consumption peaked at 40 bn cigarettes, but owing to a vigorous anti-tobacco campaign by government and civil society groups, it dropped to 24 bn by 2003, says Mr. Peter Ucko of the National Council Against Smoking. He says taxation was "the single most important factor that contributed to the decline in smoking, because it made smoking less affordable." South Africa also used other measures, passing legislation in 1995 that requires health warnings to be placed on tobacco product packages and banning advertising in 2000. The government complemented these actions with increased public-awareness and educational campaigns in the media, and it set up a national telephone "quit line."
In many African countries, there is "ample room to increase tobacco taxes," says Dr. Yach. Whereas taxes amount to two-thirds or more of the retail price of a pack of cigarettes in high-income countries, by contrast they amount to no more than half the retail price in poorer countries. Of greater concern, he says, is that between 1990 and 2000 cigarette prices in many African countries declined in real terms. In Côte d'Ivoire, Gabon, Kenya and Nigeria, a pack of 20 cigarettes is now more than 25 per cent cheaper than it was in 1990.
Dr. Yach notes that a 10 per cent increase in cigarette taxes in Zambia, for example, would increase cigarette tax revenues by more than 7 per cent and lead to a 2.4 per cent drop in consumption. Moreover, the additional funds generated by such efforts could be used for other health priorities. "Extra tobacco tax revenue could be a crucial and immediate source of funding for HIV/AIDS and malaria, as well as for tobacco control."
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