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Critics fear Pacific trade deal favours big business over states

By Glenda Kwek | AFP

With the end game in sight to what could be the world’s most ambitious trade deal, critics fear a controversial mechanism to protect investors will strengthen the hand of big business while eroding national sovereignty.

The Trans-Pacific Partnership (TPP) — a wide-ranging accord that would encompass 40 percent of the world’s trade — could be sealed in Hawaii this week after more than five years of talks.

The United States, the chief architect of the ambitious pact which takes in 11 other Pacific Rim countries, says it would loosen trade restrictions, drive jobs growth and encourage investment by strengthening legal protection for companies.

But critics say it favours multinational corporations over state interests and individual consumers, pointing in particular to a proposed investor-state dispute settlement (ISDS) mechanism that would allow foreign companies to sue governments, likely through international tribunals.

They warn ISDS cases might expose states to potentially huge liability claims — a bigger risk for developing countries that do not have deep pockets — and may also threaten their ability to introduce health and environmental laws.

That is a particular issue because there are several developing countries among the prospective members, which are Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam.

“There are risks for all governments involved in the TPP in relation to the investor-state dispute settlement,” Matthew Rimmer, an intellectual property expert at the Queensland University of Technology, told AFP.

“Under the regime, investors — particularly multinational companies — can bring actions against governments, but governments cannot bring actions against corporations.

“So it’s a very one-sided regime and it can provide special rights to foreign investors that are not present for domestic investors.”

– Cases on the rise –

The issue has become a particularly hot topic in Australia, which was sued by tobacco giant Philip Morris after it became the first country to introduce plain packaging laws for cigarettes in 2012.

Canberra refused to reveal its legal bill for defending the claim from Philip Morris, which argued the legislation breached a bilateral investment treaty.

The case, and broader concerns about ISDS processes, saw Australia’s top judge Chief Justice Robert French warn last year that claims tribunals could undermine domestic legal jurisdictions.

Philip Morris’ suing of Uruguay after the country ordered that the health warnings be larger on cigarette packets helped prompt billionaires Bill Gates and Michael Bloomberg to launch a fund to support developing states in their legal battles with tobacco giants.

On a global scale, the number of cases brought by companies against governments has been on the rise in recent years, according to figures from the United Nations Conference on Trade and Development (UNCTAD).

Out of 608 known cases brought between 1987 and 2014, more than a quarter of them were over the past three years, UNCTAD said, adding that confidentiality agreements meant there were likely more.

Of particular concern to ISDS opponents, less developed economies have faced a larger proportion of such suits, although the relative share of cases against developed countries is on the rise.

Meanwhile, most litigation was started by investors from developed countries — particularly from the US, Canada and several European Union nations — accounting for more than 80 percent of all claims.

– ‘Blunt instrument’ –

Tim Harcourt, former chief economist at Australia’s trade promotion body Austrade, said the ISDS was a “blunt instrument” to protect companies’ interests.

“Giving international companies the right to sue countries left, right and centre is probably not the way to build those (free trade) institutions,” he told AFP.

“The way to protect investors is by building local institutions so they’re transparent, and ultimately countries that don’t have transparent institutions like Venezuela, people won’t invest there.”

Concerns have also been raised in the United States, including by influential Democratic Senator Elizabeth Warren.

“ISDS would allow foreign companies to challenge US laws — and potentially to pick up huge payouts from taxpayers — without ever stepping foot in a US court,” she said.

But Alan Oxley, the first Australian to chair the General Agreement on Tariffs and Trade (GATT), the World Trade Organization’s predecessor, said fears that the ISDS favours international business over governments were overblown.

He said an international arbitration tribunal would be an effective way to settle claims as it gave foreign investors an automatic right to appeal without government approval.

Australia’s foreign affairs department has released a “myth versus realities” TPP document that stresses an ISDS tribunal “could not overturn domestic court decisions nor force Australia to change its laws”.

“If you talk to anybody in business, they’ll say that’s a good idea, whereas the opposition is coming from quite a small fringe group,” Oxley, who heads up the Australian APEC Study Centre at RMIT University, told AFP.

The Trans-Pacific Partnership issues in-depth

M.Scott Mahaskey/POLITICO

By Doug Palmer

There are hundreds if not thousands of issues to resolve within the nearly 30 chapters of the proposed Trans-Pacific Partnership pact, which would cover more than 40 percent of world economic output. Here are some that have received the most attention:

Autos — The United States has a 2.5 percent tariff on cars and 25 percent tariff on trucks; Japan has no tariffs on vehicles. However, the American Automobile Policy Council, which represents Ford, General Motors and Fiat Chrysler, says regulatory and tax hurdles effectively make Japan the most protected and closed automotive market in the world. U.S. negotiators have secured a commitment to phase out the 25 percent tariff on trucks over the longest period allowed for any product in the TPP — a way to counter any move by Japan to put long phase-outs of import tariffs on sensitive agricultural products. But for the past two years they have also been engaged in a negotiation aimed at dismantling “non-tariff barriers” that Japan has erected to U.S. auto exports. Japanese automakers produce all of the trucks and 71 percent of the vehicles they sell in the United States at their plants in North America. They argue Detroit-based automakers only have themselves to blame for their lack of success in Japan by offering cars larger than most Japanese consumers prefer. Meanwhile, both U.S. and Japanese automakers have interests in Malaysia, a booming auto market with significant restrictions on imports.

Currency — The White House beat back an effort in Congress to put a provision to require enforceable rules against currency manipulation in a bill to fast-track the passage of trade agreements. Still, the legislation makes addressing the concern a principal U.S. negotiating objective — the first time that has been done. If the TPP fails to include a meaningful currency provision, the pact could be subject to a disapproval resolution stripping away its “fast track” protections, making it open for amendment and subject to filibuster in the Senate. Ohio Sens. Rob Portman, a Republican, and Sherrod Brown, a Democrat, have been out front in calling for enforceable currency rules, as have Democratic lawmakers from Michigan such as Rep. Sander Levin and Sen. Debbie Stabenow.

Dairy — A complicated four-way dance is going on in the dairy negotiations, and right now everyone is waiting for Canada to make its move. U.S. dairy producers were opposed to the agreement when it only included New Zealand, the world’s largest dairy producer, but came around when Canada and Japan, two substantial dairy markets, joined the negotiations. Now, as trade officials head to Maui, it looks like Japan is prepared to strike a deal on dairy products, although some concerns over access to its butter market remain. But so far, Canada has not put a meaningful dairy market offer on the table, leaving U.S. producers to fear they could lose more from the final agreement than they gain. That’s a problem for congressional approval because, as one lobbyist observed, “every senator has a cow in their state.”

Geographical Indications — Many common names for cheese, such as parmesan and asiago, originated in Europe, and in recent free trade agreements, the European Union has tried to lock up rights to use the names for its own producers. The U.S. dairy industry fears that could hurt its exports and wants safeguards against that practice in the TPP. However, some countries such as Canada, which is currently part of the TPP talks, and South Korea, which could join in a second tranche, have already signed free trade pacts with the EU that contain protections for geographic indications.

Government Procurement — Many countries restrict access to their public works contracts, reasoning that domestic firms should be the main beneficiaries of taxpayer-funded projects. The United States allows some “Buy American” preferences for its own companies but generally has an open market and has pushed for more access to foreign government procurement through its free trade agreements. The issue is a sensitive one for Malaysia, which has had government procurement preferences to help ethnic Malays since 1969 and previously walked away from free trade talks with the United States over the issue. Many members of Congress from steel-producing states do not want to see any weakening of Buy American provisions under TPP, while Canada has sought more access to U.S. state and municipal projects funded by federal dollars.

Investor-State Dispute Settlement — Opponents of free trade agreements often point to the investor-state dispute settlement mechanism as one of their concerns. The provisions allows companies to sue host governments for actions that damage their investment. Critics say it undermines the right of governments to regulate in the public interest, while proponents say it is a necessary protection against discriminatory and arbitrary government action. Australia refused to include an ISDS provision its 2005 free trade pact with the United States, possibly because the United States refused to provide more access for Australian sugar. Australia more recently said it would consider the issue on a case-by-case basis and included ISDS in its free trade pact with South Korea but not with Japan, both of which it concluded in 2014. The United State has ISDS in all of its free trade pacts except the one with Australia.

Labor and Environment — Labor groups have been some of the harshest critics of free trade agreements, arguing they keep wages low in the United States by encouraging companies to move production overseas in search of a cheaper workforce. Environmental advocates worry about damage to critical natural resources as result of increased trade. Neither group has been assuaged by the administration’s promises that the TPP will be the “most progressive” trade agreement in history. While final details are still secret, the pact is expected to contain enforceable labor and environmental provisions. However, some lawmakers have urged that countries such as Vietnam be required to comply with labor and environmental provisions of the pact before receiving any of its market access benefits.

Pharmaceuticals — This issue pits Washington’s desire to provide profit incentives for American pharmaceutical companies to develop new drugs against critics who say overly restrictive patent and clinical test data protections drive up the price of generic medicines and potentially limit the ability of countries to define their own national intellectual property standards. Recent U.S. free trade agreements with Colombia, Peru, Panama and South Korea have provided five years of “data exclusivity” for patent holders. Another protection, known as patent linkage, was made voluntary for the three Latin American countries but mandatory for South Korea. It requires regulators to check for potential patent violations before approving a new generic drug for manufacturing. The United States has been pushing for 12 years of data protection for “biologic” drugs, the same as contained in the 2010 Affordable Care Act, but is alone on that position. Both Canada and Japan provide eight years of data protection for biologics in their own laws while five years is the norm for many other countries. The advocacy group Médecins Sans Frontières has warned 12 years of data exclusivity for biologics would “limit access to medicines for at least half a billion people,” but Senate Finance Committee Chairman Orrin Hatch has pushed hard for the lengthy term.

Pork — When Japan sought to exclude a long list of “sacrosanct” agricultural commodities from complete tariff elimination under the pact, no one screamed their opposition louder than the National Pork Producers Council. A year later, the group’s efforts seem to have to worked, and the pork industry appears largely satisfied with the Japanese market access package as final negotiations near, although officials have some remaining concerns that they say need to be addressed in Maui. U.S. pork producers are also excited about the deal with Vietnam, a fast-growing country of 90 million people where rising incomes are expected to boost meat consumption in future years. Iowa and North Carolina are the top pork-producing states, but production is spread throughout the Midwest and reaches as far south as Texas.

Rice — Japanese consumers eat more than 130 pounds of rice each year, about four times U.S. levels, but very little comes from outside the country. Because rice cultivation is so closely associated with the national identity, the government uses a combination of strict quotas and high tariffs to ensure picturesque rice paddies remain in the Japanese landscape. U.S. rice producers still hope for expanded export opportunities, but if the United States is stingy with Australia on sugar it’s harder to press Japan on rice. Arkansas is the biggest rice producing state, with sizeable production in Louisiana, Texas and California.

State-owned enterprises — Companies directly or indirectly owned by governments play an increasingly large role in international trade and often are dominant players in their own markets. Japan Post, a state-owned conglomerate that operates a wide variety of businesses, including post offices, banks and an insurance division, ranks 23rd on Fortune magazine’s list of the 500 largest companies in the world. SOEs are responsible for an estimated 40 percent of Vietnam’s economic output and also play major roles in Malaysia and Singapore’s economies. TPP countries appeared to have largely agreed on a set of rules to “level the playing field” between state-owned and private firms, but a debate continues over which SOEs would be excluded from the disciplines.

Sugar — The U.S. government supports domestic sugar prices by restricting imports but typically has given free-trade partners some additional access to the United States. Not so with Australia, which got nothing on sugar in the free trade deal it struck in 2004. U.S. Trade Representative Michael Froman has hinted the U.S. would provide some additional access this time around but in a way that would not jeopardize the sugar program, which benefits sugarcane farmers in Florida and Louisiana and sugarbeet growers in Michigan, Wisconsin, North Dakota, Nebraska, Montana, Wyoming, Idaho and Washington.

Tobacco — With U.S. cigarette consumption continuing to fall, American tobacco companies are eager for new markets to sell their cancer sticks, coffin nails or lung busters, as they are known on the street. Many anti-smoking groups argue tobacco should not even be included in free trade agreements, while farm and business groups counter that excluding any legal product sets a bad precedent. The issue gained prominence after Philip Morris used a bilateral investment treaty between Hong Kong and Australia to sue for damages stemming from Australia’s “plain packaging” law, which replaced familiar cigarette trademarks with graphic images of cancer victims. U.S. trade officials proposed to address the issue within the TPP by agreeing that measures taken to protect human, animal or plant life or health would not violate the agreement as long as they not disguised trade barriers. Washington also proposed requiring any TPP country to first consult with its TPP partners before challenging any tobacco control measure as a violation of the trade pact. Neither anti-smoking nor business groups were happy with the compromise. Malaysia countered with a proposal that would exempt tobacco-control measures from being challenged under TPP.

Textiles and Footwear — The United States imported $82 billion worth of apparel in 2014, including about $30 billion from China. Vietnam was second with more than $9 billion in sales to the United States and would be in a good position to grab market share from China under TPP pact because of tariff elimination. However, strict “rules-of-origin” are expected to limit Vietnam’s gains by requiring that any clothing be wholly assembled within the TPP countries to qualify for duty-free treatment under that pact. That means Vietnam could not import fabric from a third country, such as China, and use it to make clothing that qualifies for duty-free treatment. Some exceptions to that rule, in terms of a list of apparel products that are in “short supply” in the United States, are expected. Still, a significant loosening of the so-called “yarn forward” rule of origin poses problems for clothing manufacturers in TPP countries Peru and Mexico, who have adapted to the standard. Meanwhile, Boston-based shoe manufacturer New Balance also is worried about increased imports from Vietnam under the pact and has fought to maintain duties on a number of products lines it assembles at its facilities in Maine.

Online consultation on Macau’s anti-smoking bill to start on Aug 1,english/

Standing Committee President Chan Chak Mo

Standing Committee President Chan Chak Mo

The Legislative Assembly’s (AL) 2nd Standing Committee President Chan Chak Mo said Wednesday his committee had decided to hold a two-month online consultation about the government-drafted anti-smoking bill, starting at the beginning of next month.

The committee met Wednesday to discuss the controversial Tobacco Control and Prevention Law amendment bill.

The bill proposes four main changes to the law, including increase in the public areas where a blanket smoking ban would be in place, such as on all casino premises, and within 10 metres from any bus stop, as well as forbidding the sale of e-cigarettes locally, prohibiting shops from displaying packets of cigarettes, and an increase in the penalties for violating the anti-tobacco law.

The outline of the amendment bill was passed early this month, with 26 legislators’ ayes. Lawmakers Zheng Anting and Kou Hoi In voted against it.

Speaking after the meeting, legislator-cum-restaurateur Chan said that while most lawmakers had no issue with the majority of the bill’s articles, many were concerned about its proposed blanket smoking ban in the city’s casinos, prison and even tobacco shops.

Chan said after the discussion among the committee members, they had agreed to hold a public consultation about the bill on the legislature’s website, which would start on August 1 and run until September 30. He said the committee welcomes everyone to voice their opinion during the period.

The legislature’s website is in Chinese and Portuguese, although there is a page outlining the legislature’s work in English.

Chan added that the committee would also arrange a meeting with the city’s six gaming operators and the management of Macau Prison, as well as a number of civic groups, including six gaming-industry-related unions, such as the Association of Gaming and Entertainment of Macau (AMJEM) and the Macau Gaming Industry Frontline Workers (FMG), as well as two tobacco industry-related unions.

Chan said the lawmakers were concerned that a blanket smoking ban would affect the prison’s operations. Currently, the prison provides a number of smoking rooms for its inmates.

Chan insisted that the committee did not need to consult medical experts at this stage, as “they would just repeat what has already been said.”

Chan also said that it was the committee’s duty to discuss possible changes to the bill, but it would ultimately be up to the government to make any changes.

As is customary, the bill will be discussed in detail by the committee before it is returned with a report by its members about the final version to another plenum for an article-by-article vote.

Chan said while he understood the urgency of the bill, he expected the discussion and possible revisions to last about a year.

The city’s gaming operators oppose the bill’s proposed blanket ban on smoking on all casino premises, arguing for the continuation of smoking lounges, namely in VIP gaming rooms.

Currently, smoking is banned in mass-market gaming halls which, however, are allowed to set up smoking lounges.(macaunews/macaupost)

British American Tobacco is ending operations in Chile

July 9 2015

British American Tobacco is closing its operations in Chile because of changes to the country’s tobacco law, the company announced Thursday.

The world’s No. 2 cigarette maker, which produces brands like Dunhill, Lucky Strike and Pall Mall, objects to changes that include banning additives like menthol and adding larger warnings to cigarette packs about the risks of smoking.

The Chilean unit of the company called the toughening of Chile’s tobacco law “unconstitutional and arbitrary.”

“We deeply regret what has been approved by the Senate, a decision that will affect thousands of Chileans who were working legally and responsibly for more than 100 years,” the company said in a statement.

British American Tobacco says the modifications approved by Chile’s Senate this week would affect its business and hurt a “significant number of farmers and workers” who produce and sell tobacco in the country.

The company, which has operated in Chile since 1909, says it’ll start the phase-out by firing 20 percent of its nearly 1,000 employees. It estimates about $400 million could be lost with the menthol ban and warning label changes.

Majority of Americans Agree You Should Be 21 to Buy Tobacco

Tanya Basu @mstanyabasu

Three out of every four American adults favor increasing the minimum age from 18

Three out of every four American adults favor increasing the minimum age to purchase tobacco from 18 to 21, according to a survey released Tuesday.

The study, released by the American Journal of Preventive Medicine on Tuesday, also found that smokers overwhelmingly agreed; 7 of 10 cigarette smokers backed raising the minimum age.

Brian King, acting deputy director for research translation at the Center for Disease Control’s Office on Smoking and Health, highlighted the health benefits that could come from such an increase. “It could delay the age of first experimenting with tobacco, reducing the likelihood of transitioning to regular use and increasing the likelihood that those who do become regular users can quit.”

Most states require tobacco purchases to be made by someone who is at least 18; in Alabama, Alaska, New Jersey, and Utah, the minimum age is 19. Hawaii, however, already has a must-be-21 to purchase tobacco rule in place.

The data came from a 2014 online survey of 4,219 adults over 18. A separate study earlier this year found that if the all states were to raise the minimum age for tobacco sales to 21, there would be a 12% decrease in smokers along with 250,000 fewer premature deaths

Marching to Big Tobacco’s tune?

Has the global tobacco advocacy been manipulated by Big Tobacco’s lobbying agenda? Where the tobacco lobby is concerned, it would be naive to think there’s smoke without fire.

One of the dirtier secrets of the international tax world — and yes, the bar is quite high — is the role of tobacco companies in seeking to manipulate policies that might reduce the number of people dying because they consume tobacco.

The main angle taken by the lobby has been to direct attention toward “illicit” tobacco, where customs duties and tax may not have been paid.

Now I care a lot about tax, but even I can see that whether tobacco was taxed before being consumed is barely even a second-order issue, when compared to the question of whether people are dying because of their consumption — which they are, and will continue to do, in their millions.

But the thematic focus of the World Health Organization’s (WHO) World No Tobacco Day 2015 is not directly on stopping tobacco consumption, as the name might suggest. Instead it turns out to be: “Stop the illicit trade in tobacco products.”


Tobacco kills. And overwhelmingly, it kills poorer rather than richer people; and as time goes by, it kills people in poorer rather than richer countries.

In a rich country like the United States, researcher Prabhat Jha and colleagues find that: “The rate of death from any cause among current smokers was about three times that among those who had never smoked… The probability of surviving from 25 to 79 years of age was about twice as great in those who had never smoked as in current smokers (70% vs 38% among women and 61% vs 26% among men). Life expectancy was shortened by more than 10 years among the current smokers, as compared with those who had never smoked.” But it is in lower-income countries where most smokers and tobacco consumers are, and will be. Consequently, it is in lower-income countries where most tobacco-related deaths happen and will happen: Over four million a year, more than TB, malaria and HIV/AIDS combined (data from Tobacco Atlas). And the costs are likely only to rise, since the number of daily smokers continues to grow, from 721 million in 1980 to 967 million in 2012 (despite a drop in smoking prevalence).

So call it a billion daily smokers. That’s a big market, for something expensive and addictive.


The most visible activity of the tobacco lobby is that carried out by the International Tax and Investment Center (ITIC). The Financial Times covered the ITIC in October, under the headline “Tobacco lobby aims to derail WHO in tax increases.” It reported:

“A tobacco industry-funded lobby group will attempt to derail a World Health Organization summit aimed at agreeing increased taxes on smoking, according to leaked documents seen by the Financial Times.

“The International Tax and Investment Center, which is sponsored by all four major tobacco groups, will meet on the eve of the WHO’s global summit on tobacco policy in Moscow later this month in a bid to head off unwanted duty increases.”

The WHO sees the ITIC’s actions as so extreme that it has called for governments not even to engage with them. With such a position taken by a major United Nations (UN) body, the ITIC cannot be seen as legitimate in its claim to provide objective analysis to governments around the world.


But within the tax sphere, many leading actors work with the ITIC.

As the Observer highlighted, the former permanent secretary of HM Revenue and Customs (head of the United Kingdom tax authority) became a director of ITIC just a year after stepping down. His justification, given to the paper, was that he is not an executive director and is unpaid; and that around 50 other “leading figures in taxation” are involved in the same way.

The ITIC’s “senior advisors” list is certainly an impressive one from the tax perspective, including a number of respected researchers and tax officials, with Jeffrey Owens — former head of the Organization for Economic Cooperation and Development (OECD) tax arm, the Centre for Tax Policy and Administration — singled out as a “Distinguished Fellow.”

Similarly, it’s unclear why non-tobacco multinationals like Goldman Sachs or ExxonMobil would want to associate themselves with this lobby, not to mention the professional services firms which include the big four accounting firms, and lawyers such as Pinsent Masons.

The ITIC explains it this way: “Sponsors recognize the tremendous value added by ITIC in the countries in which they operate, through the promotion of an environment that welcomes business.”

But commercial organizations of this size can surely promote such an environment without the taint of tobacco lobbying.

There could hardly be a clearer message for the sponsors and fellows to find an alternative to the ITIC, than for a major UN organization like the WHO actively warning governments not even to engage with it.


What about the substantive basis for the arguments made by the ITIC?

The main claim made is that taxing tobacco creates incentives for illegal tobacco trade. This in turn reduces the revenue benefits of the tax, and also encourages criminal activity:

“This growing and dangerous problem is not just a tax issue — beyond substantial government revenue losses, the impact of illegal trade constrains economic development and raises barriers and costs for international trade,” said Daniel Witt, president of ITIC. “It also poses significant health risks, and presents numerous challenges for law enforcement, from violations of intellectual property rights to money laundering and organized crime activity.”

Arguments along these lines have been used in seeking to influence tax policy — that is, against higher tobacco taxes — from Ukraine to the Philippines, with critics arguing that the estimates provided tend to systematically overstate the case.

A recent study published in the British Medical Journal’s Tobacco Control, for example, looks at estimates produced for Hong Kong, and finds that: “The industry-funded estimate was inflated by 133 — 337% of the probable true value.”

As Bill Savedoff highlights in his Center for Global Development podcast, the broader evidence simply does not support the claim that higher tobacco taxes lead to illicit tobacco trade. Significant tax rises over the last 10-15 years have not been associated with any increase in the proportion of tobacco that is illicit (about 9%-11%). Other factors like enforcement and effective tax administration seem much more important.

In addition, as Savedoff puts it: “What’s particularly ironic about this argument from the tobacco companies is that they are the ones that have been responsible for most smuggling… Essentially, to get the magnitude of smuggling that you would need, to have an impact on the tobacco tax, or consumption, you have to have the complicity, if not the actual responsibility, of the tobacco companies themselves.”

Also, Michal Stoklosa of the American Cancer Society in a Tobacco Atlas paper, argues that “most importantly, it is clear that the measures that aim at reducing demand for cigarettes more generally are crucial in reducing the illicit trade problem.”

There is no doubt that illicit trade in tobacco exists; and nobody argues it’s a good thing. But it’s clearly not the big issue about tobacco consumption — that would be, er, tobacco consumption.

Illicitness, in this case, is not associated with any greater health damage. And overall tax revenue losses do not seem to result from well-administered rises in tobacco taxation that cuts consumption, because illicit trade has tended not to increase. (As an aside: unlike some taxes, revenue is not the prime reason for “sin” taxes — in this case the aim is, explicitly, to reduce the tax base and eventually the revenues, by curtailing damaging behavior.)

Should the WHO then use its biggest awareness-raising moment of the year to focus on illicit trade? From the outside, it seems clear that “No Tobacco” would have found a stronger expression in a theme that sought to reduce all tobacco consumption.

I don’t mean to suggest anything illicit in the WHO’s adoption of this theme. Clearly they have taken a very direct stance against the well-funded lobbying of the ITIC. But if we ask whether this theme would have been chosen, absent ITIC lobbying over recent years, it seems likely the answer is no. I hope the WTO can stick to the mission of the day — that is, of No Tobacco.

For now, chalk one up for the ITIC.

But then ask: Of the many individuals — the chairmen, co-chairmen and directors — and the professional services firms and non-tobacco multinationals working with the ITIC, how many would see this as a win?

Do they each mean to lend their names and reputation to an organization that has consistently lobbied individual governments, especially in developing countries, and international organizations, against tax measures that are proven to reduce tobacco consumption, and all the health damage and needless death that results?

If not — and I very much hope not — then World No Tobacco Day 2015 seems like a fine time to step away from the ITIC.

Alex Cobham is an Oxford-based economist who has collaborated with Action for Economic Reforms in advancing tax reforms. He is the director of research of the Tax Justice Network.

Former lawmaker Lo Wing-lok dies; wanted yearly cigarette tax hikes of 5pc



Former legislator, Lo Wing-lok, has died at the age of 60. He had lung cancer.

Dr Lo represented the medical sector between 1998 and 2004.

He was once a member of the League of Social Democrats, but quit in 2008 due to differences with the then chairman Raymond Wong.

He also stood in the 2012 Legco polls as an independent.

Lo Wing-lok wants yearly cigarette tax hikes of 5pc

17 December, 2003

The government should increase tobacco tax by 5 per cent a year if it is to successfully lower the number of people smoking, the head of the Medical Association said yesterday. Legislator Lo Wing-lok, who also represents the medical sector, said raising the tax was the most effective means of stopping more people falling victim to smoking.

Raising the minimum buying age for tobacco could mean fewer people start to smoke

Apr 2 2015

Micah Berman

In 2005, the Boston suburb of Needham tried a new tactic to reduce youth tobacco use: the town raised the legal age for purchasing tobacco from 18 to 21. The results were dramatic – tobacco use among high school students dropped almost in half, and Needham’s decline in high school smoking rates far outpaced the surrounding suburbs.

In the past two years, communities around the country have begun to follow Needham’s lead. To date, more than 50 communities in seven states have raised their tobacco sales age to 21, including New York City in 2014. And the momentum keeps growing. And at least 10 state legislatures are now considering Tobacco 21 legislation.

Earlier this month, the Institute of Medicine (IOM), which is part of the National Academy of Sciences, released a 335-page report detailing the benefits of raising the tobacco sales age to 21, which would match the minimum age for purchasing alcohol.

Of all the options for addressing tobacco use, why are Tobacco 21 policies catching on? Why do they work?

Tobacco use is a ‘pediatric epidemic’

Think about the people you know who smoke. How many of them smoked their first cigarette before age 21? How many of them wish they had never smoked that first cigarette? The likely answer to both of these questions is: all of them.

The US Surgeon General has referred to tobacco use as a “pediatric epidemic,” because it almost always begins in youth. Indeed, despite all we know about the harms of tobacco, it is still the case that one in four high school seniors is a smoker and youth tobacco rates have barely budged over the past decade.

Of those who begin smoking as youth, 80% will smoke into adulthood, and one-half of all adult smokers will die prematurely from tobacco-related diseases.

The flip side of tobacco use being a “pediatric epidemic” is that the likelihood of starting to smoke declines markedly with age. The older you are, the less likely you are to start smoking. Although the tobacco industry has been increasingly targeting college-age students with its marketing, it remains the case that if someone makes it through high school without smoking, it is unlikely that he or she will ever start.

The tobacco industry has recognized this for years. In a 1982 memo, a researcher from the tobacco company R J Reynolds stated: “If a man has never smoked by age 18, the odds are three-to-one he never will. By age 21, the odds are twenty-to-one.”

Why do Tobacco 21 policies work?

Tobacco 21 policies are effective because they make it much more difficult for middle and high school students to access tobacco. This is because youth tobacco experimentation and use is driven by legal tobacco sales, not by illegal ones.

Today, at least in most places, 18- and 19-year-olds can legally purchase tobacco products and then supply them to younger kids (who, at least in the early stages of smoking, only use cigarettes occasionally). Raising the minimum age to 21 puts legal purchasers outside the social circle of most high school students.

Of course, raising the tobacco sales age to 21 will not keep all high school students from finding ways to access tobacco products, but the experience in Needham suggests it will significantly reduce the amount of youth tobacco use.

Given the scope of the problem – more than 3,800 kids under the age of 18 start smoking every day – the public health benefits could be enormous. Using conservative assumptions, the IOM study concluded that a nationwide Tobacco 21 policy would avoid nearly 250,000 premature deaths among those born between 2000 and 2019. Other public health benefits, such as a reduction in low birth weight and pre-term births, would be far more immediate.

We also now know that a legal age of 18 for tobacco is out of touch with what the scientific evidence says about adolescent brain development. As discussed in the recent book The Teenage Brain, brains do not fully mature until people reach their early 20s (and possibly later).

For a still-developing brain, exposure to nicotine causes long-term neurological harm; in essence, the addiction to nicotine gets hard-wired into the developing brain. This leads to a stronger nicotine addiction and makes it much more difficult to quit later on. For this reason, the recent explosion in youth e-cigarette use is deeply troubling, and Tobacco 21 policies should also include e-cigarettes, hookahs and other products that deliver nicotine.

18 is not a magic number

Federal law prohibits the FDA from raising the tobacco sales age above 18; only Congress can do that for the nation as a whole – and it’s hard for Congress to get anything done these days. But every state and most communities have the legal authority to adopt Tobacco 21 laws, which is exactly what they are starting to do.

The opposition to this emerging movement (primarily tobacco companies and tobacco retailers) chants “old enough to vote, old enough to smoke.” But tobacco use is not a right or a privilege; it is an addictive and deadly activity. For the overwhelming majority of smokers, tobacco use is not in fact an “adult choice;” it is the result of an addiction that began when they were in high school or younger, and one that they are trying hard to kick.

There is nothing natural or unchangeable about a minimum age of 18. In traditional British common law, the “age of majority” (adulthood) was 21. In the US, the voting age was not lowered from 21 to 18 until 1971, but soon thereafter states began raising their drinking age from 18 to 21 when they realized that teens were disproportionately responsible for drunk driving accidents.

More recently, states that have sanctioned the legal use of marijuana – a drug far less deadly than tobacco – have set 21 as the minimum age. In short, it has long been the case that there are different minimum ages at different times and for different purposes.

Something we can agree on

Because no one (except for tobacco companies) wants the next generation to smoke, raising the minimum age to 21 is one tobacco control policy that nearly everyone can agree upon. It’s no surprise then, that a recently published study found that more than seven in 10 adults favored increasing the tobacco sales age to 21, including strong majorities in every demographic category (including current smokers and 18-20 year olds). This is the rare policy measure that is bipartisan, popular, and effective. What are we waiting for?

Lee a pioneer in fight against smoking

7 Apr 2015

Lee Kuan Yew has been memorialised in many ways since he died last month, but his most lasting and enduring legacy may well be in the prevention of deaths from smoking.

He visited Britain in 1969, just when the evidence on the harm of tobacco was beginning to surface.

The story has it that someone mentioned to him – almost in passing – that smoking was harmful. In true style, he returned to Singapore and, well before any similar measure in the West, passed the world’s first serious piece of tobacco control legislation in 1970, banning smoking in buses, cinemas, theatres and other specified buildings.

This was shortly followed by a second law in 1971 banning tobacco advertising. This was the birth of utilising tobacco control laws to reduce the then- emerging epidemic of smoking deaths.

These Singapore laws were also landmarks in understanding the role of law in the promotion of public health, and that the tobacco war would never be won in the corridors of hospitals and clinics, but in the corridors of power.

Political will is still the single most important ingredient in reducing what is now a pandemic of tobacco deaths – and needed more today than ever.

Dr Judith Mackay, director, Asian Consultancy on Tobacco Control

‘Scarier’ cigarette packet warnings and ban on e-cigarettes mooted in Hong Kong

8 Apr 2015

Emily Tsang

Warnings on cigarette packets that “smoking kills” are not scary enough, according to new government proposals under which tobacco products will be labelled with even more frightening content, a health official says.

Other new measures include expanding no-smoking areas and a citywide ban on the sale of electronic cigarettes, said Professor Sophia Chan Siu-chee, undersecretary of the Food and Health Bureau.

These proposals are expected to be presented to the Legislative Council this year.

One of the bureau’s main goals is to expand the size of the health warning, which now covers about 50 per cent of the pack, and to replace them with “scarier” messages targeted at female and young smokers.

Those currently in place had been criticised as not scary enough, Chan said. “They have been in use since 2006, and the government believes it is time to update the content,” she said.

According to the Department of Health, the proportion of people who smoke daily has seen a downward trend, with a low of 10.7 per cent in 2012, the last year for which data is available. But while that is one of the lowest in the world, Chan said “we shouldn’t be proud”, and should continue trying to reduce it.

Many countries such as Thailand and Canada have enhanced the warnings by having them cover 60 to 80 per cent of each pack. In late 2012, Australia issued the world’s toughest warning – by replacing all of the branding labels with warnings that cover the whole packet.

Antonio Kwong Cho-shing, chairman of the city’s anti-smoking watchdog the Council on Smoking and Health, said Hong Kong should do the same.

But Chan said the city may not decide to go quite so far, and the size of the health warning would be open for public discussion.

She also highlighted the importance of enhancing the warning message targeting female smokers. Bucking the citywide trend, the number of women who smoke has risen 70 per cent between 1990 and 2012, from 56,100 to 96,800 – although women accounted for just 3.1 per cent of all smokers in 2012.

“Women smoke for a different reason, usually due to psychological reasons such as stress and depression. Some believe it helps in losing weight. Since they are more aware of their appearances, the messages can target how tobacco would affect their skin texture or [make them look] older.”

Chan said the new warning would also highlight the health risk for parents exposing their children to second- and third-hand smoke.

But the Coalition on Tobacco Affairs, made up of representatives from tobacco companies, objected to the move and said current warnings were sufficient. A spokeswoman said there was no evidence that oversized warnings reduced smoking, and said the move would harm the intellectual property rights of tobacco companies.

The government’s push to enhance the warning labels followed its decision not to raise the tobacco tax this year. Chan said a tax increase would be considered again in the next fiscal year.

dynamco Apr 8th 2015 3:07pm

apathetic, backward, useless, retrograde, insipid ?Health? Dept spring to mind
India will have 85% graphic warnings
Australia, Ireland, UK already, followed by Wales and Scotland will have plain packs followed by France , India, Norway whilst here they sit back ‘n take the money, next year, next year
The smoking prevalence is higher than they state, no thematic study asks whether the smokers have used illicit tobacco , which would affect the figures
The Tobacco Control Office is suitably understaffed by approx 1,000 % so they cannot patrol, there is no onus on premises owners to keep their premises tobacco smokefree
20% of the 7,000 tobacco deaths every year here and from passive smoking
All in all, a fking mess from a Govt that is supposed to have duty of care to its people