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Opposition to House’s Kretek Protection Bid Heats Up

Sep 23rd, 2015
by AdminCTA.
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http://jakartaglobe.beritasatu.com/news/opposition-houses-kretek-protection-bid-heats/

Jakarta. Stern opposition continues to mount among government officials and anti-smoking activists against a bid by the House of Representatives to recognize kretek, Indonesia’s clove-flavored cigarettes, as an item of cultural heritage.

The move, in amendments being proposed for the 2010 Cultural Heritage Law, would effectively make it harder for the government to impose restrictions on kretek sales and advertising, and in fact oblige the state to support the manufacture and promotion of the cancer sticks.

“Not every traditional custom must be developed and preserved,” Education Minister Anies Baswedan said on Wednesday, “especially when it would condone smoking among students. We definitely disagree [with the House’s proposal].”

The Health Ministry has also spoken out against the move, saying it threatens to undermine the government’s ongoing efforts to educate the Indonesian public – a population where three-fifths of adult males smoke – about the dangers of smoking.

“By being including in the bill, kretek would no longer be considered dangerous [to health],” said Lily Sulityowati, the ministry’s director of non-communicable diseases.

Kartono Muhammad, the chairman of the Association of Indonesian Public Health Experts’ Tobacco Control Support Center (TCSC), said that if passed into legislation, the proposal would be “a setback to the country’s efforts at tobacco control.”

Kartono told the Jakarta Globe on Wednesday that promoting kretek would encourage and justify smoking among minors across the country.

“Passing the bill is similar to poisoning the next generations,” he said.

One in three Indonesian youths aged 13 to 15 smokes regularly, with half of them addicted to nicotine, according to the 2014 Global Tobacco Adult Survey.

“Another risk to this plan is that kretek will get special treatment in sales and advertising,” Kartono said.

He added he suspected the newly announced proposal was an attempt to head off a possible tobacco excise hike. Indonesia already has among the lowest cigarette prices in the world, with the excise accounting for 46 percent of the total price of a pack of smokes – far less than the level of 70 percent recommended by the World Health Organization.

“There may be some wheeling and dealing going on between legislators and cigarette producers,” Kartono said.

The timing of the House’s proposal has raised more than a few eyebrows, coming just as the cigarette producers’ association, or Gappri railed against a government proposal to raise the tobacco excise. The group claimed on Tuesday that producers had been forced to lay off 15,000 workers this year as demand weakens, and that any increase in prices would lead to further job losses.

Vice President Jusuf Kalla has also expressed his disapproval of the promotion of kretek in the draft, but said he was confident it would not make it through to the final legislation.

“It’s just a draft that will be discussed at the House. Of course kretek shouldn’t be included,” he told reporters at his office on Tuesday.

Kartono argued that leaving kretek off the list of cultural heritage would not have any negative impacts on clove farmers or the tobacco industry as a whole.

“Smoking kretek is only a habit – a very bad one – not a culture,” he said.

Tobacco Industry Warns of Job Losses if Excise Is Increased

Sep 22nd, 2015
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http://jakartaglobe.beritasatu.com/news/tobacco-industry-warns-job-losses-excise-increased/

Jakarta. Indonesia’s powerful cigarette lobby continues to rail against a government proposal to raise the tobacco excise, claiming producers have been forced to lay off 15,000 workers this year as demand for the cancer sticks weakens.

“More layoffs will [continue to] happen and many more will be surely affected, for example others in the supply chain,” Hasan Aoni Aziz, the secretary general of the Indonesian Cigarette Producers Association (Gappri), said on Tuesday as quoted by Viva.co.id.

“We may have to cut down production. We declare [our] objection [to the proposed excise hike]. This industry can no longer bear [any] additional burden. During the first half of the year alone, production dropped significantly.

This has never happened before,” he added.

Hasan did concede, however, that the slowing economy was not the sole factor behind the downturn in the cigarette industry, noting that many companies were automating their production processes to cut labor costs. He also said that Indonesian smokers increasingly favored “milder” cigarettes that used less tobacco, hence resulting in job losses in the tobacco-farming regions.

In Indonesia, where about 60 percent of men smoke, cigarette production increased at an annual 7 percent average between 2007 and 2013. In 2014, it declined 0.5 percent and this year will see a 2 percent fall, according to the association.

Tobacco taxes have been raised an average 11 percent annually since 2010, but the government is undecided on what to do with the tax for 2016.

The customs and excise chief previously said the government did not want to impose a tax that would price cigarettes out of the reach of consumers – an attitude in keeping with the Indonesian government’s refusal to acknowledge, in deed if not in rhetoric, the health dangers of smoking.

Tobacco Industry Indonesia Concerned about Looming Tax Hike

Sep 14th, 2015
by AdminCTA.
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In order to generate more tax revenue in 2016 the Indonesian government plans to raise tobacco taxes by 23 percent (as mentioned in the draft of the 2016 State Budget). This plan resulted in concern among Indonesia’s cigarette producers as the country’s purchasing power has already been curtailed amid the nation’s economic slowdown and high inflation. Contrary to the global trend, the Asian region recorded solid tobacco sales growth in recent years but now these countries seem to join in on anti-tobacco measures such as higher excise taxes and large pictorial warnings on packages.

http://www.indonesia-investments.com/news/todays-headlines/tobacco-industry-indonesia-concerned-about-looming-tax-hike/item5927

Indonesia is the world’s third-largest tobacco consumer (after China and India). Based on data from Basic Health Research (Riset Kesehatan Dasar) nearly 60 million Indonesians – aged over ten years – smoked in 2013, consuming around 225 billion cigarettes (figures that exclude passive smokers). Recently, the National Commission on Tobacco Control said that in the same year a total of 240,000 Indonesian people died due to smoking-related diseases. Nearly all of these casualties are men as less than five percent of Indonesian women consume tobacco products.

Widespread tobacco consumption in Indonesia is a problem for the economy as it jeopardizes enjoying the benefits of the country’s demographic bonus. Indonesia has a large and young population (about half of Indonesia’s population is below thirty years of age and thus potentially productive). However, this demographic bonus can turn into a burden if this young population cannot be absorbed by the labour market due to the lack of job availability or the lack of capable human resources due to physical illnesses (such as heart diseases brought about by tobacco consumption). Medical expenses, physical disability, and premature deaths also bring along economic costs for Southeast Asia’s largest economy.

Although Indonesia is one of the few countries, and reportedly the only one in Asia, that have not yet ratified the Framework Convention on Tobacco Control (FCTC), it did recently implement some measures to curb (directly or indirectly) the consumption of tobacco in Indonesia. In July 2014, the government introduced a regulation that requires domestic tobacco producers to place graphic warnings on cigarette packages. Then, in January 2015, Indonesian tobacco products became subject to an average tax hike of 8.7 percent in a bid to collect more tax income. And now, the government plans another tobacco tax hike in 2016. In the draft of the 2016 State Budget, the central government proposed a 23 percent tobacco excise revenues hike to IDR 148.85 trillion (approx. USD $10.4 billion).

Ismanu Sumiran, Chairman of the Association of Indonesian Cigarette Producers (Gappri), called the government’s plan to raise tobacco taxes by 23 percent ‘irrational’ due to the country’s current economic slowdown. “[…] a 6-8 percent hike would be enough, given that Indonesia’s cigarette production has fallen by 12 percent (y/y) per July 2015,” Sumiran added (quoted by Indonesian news portal Kontan).

Indonesian cigarette manufacturer Wismilak Inti Makmur responded to the looming 23 percent tax hike stating that it sees no other choice but to raise cigarette prices, hence adding inflationary pressure. In August 2015, Indonesian inflation stood at 7.18 percent (y/y). Indonesia’s largest cigarette manufacturer HM Sampoerna, currently planning a rights issue, is also expected to raise prices in order to safeguard solid profit margins.

Comments on other issues: 70% of smokers are teenagers: Expert

Jun 19th, 2015
by Editor.
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http://www.thejakartapost.com/news/2015/06/26/comments-other-issues-70-smokers-are-teenagersexpert.html

Seventy percent of Indonesian smokers are teenagers, an expert said on Friday.

“The majority of Indonesian smokers are between the ages of 16 and 25,” said Hasbullah Thabrani, an expert in tobacco consumption, as quoted by Antara news agency.

Your comments:

In Malaysia, there is a ban on cigarette sales to those under 18. There is also a fatwa on the ban for Muslims, but most smokers pay no attention to the edict. Loh Taun

Indonesia has some of the coolest and hippest anti-smoking ads in the world. They are so cool that they can be interpreted as cigarette advertising themselves (although cigarette ads are already rampant).

Observe how their warning sign carries a picture of a “cool, muscular dude” puffing away and in the background there is a picture of a really “cool” skull (which to them is supposed to represent death but kids will probably see it as the guy smoking away to ward off this ghostly skull). Abu

It is time to execute a few tobacco executives or maybe a few smokers. That should act as a deterrent! Coling

I feel reluctant to agree with the presented data. In order to make it bite, the government should increase the excise tax every three months to follow in the footsteps of Singapore, Malaysia and Australia. According to a survey taken in 2014, hand-rolled clove cigarettes are much cheaper than machine-made ones as lower tax is imposed on them. Revising and increasing the excise tax would surely hurt the pockets of die-hard smokers and warn youngsters that it is an expensive habit to pick up. Luwanto

New bill will challenge tobacco control efforts in Indonesia

Jun 2nd, 2015
by Editor.
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http://theconversation.com/new-bill-will-challenge-tobacco-control-efforts-in-indonesia-40771

Indonesia is behind other countries in Asia Pacific in tobacco control and seems to be regressing.

In 2010, a video of a smoking toddler in Indonesia went viral, showing the extent of unhealthy addiction to cigarettes that the country has.

Five years after the shocking video surfaced, Indonesia is still behind in tobacco control and seems to be regressing. Indonesia is the only country in the Asia Pacific that has yet to ratify the international Framework Convention on Tobacco Control (FCTC). The Indonesian parliament, intent on pushing tobacco industry interests, is deliberating a bill that will obstruct tobacco control efforts in Indonesia.

A burgeoning health problem

Around 200,000 Indonesians die from tobacco-related illnesses every year. In addition, economic losses caused by smoking, including medical expenses, physical disability, premature death and reduced working hours, reach A$24 billion annually.

More than two-thirds of adult males are smokers in Indonesia. And nearly four million Indonesian children between the ages of ten and 14 pick up smoking every year.

Indonesians smoke 300 billion cigarettes in a year. Only China and India exceed this number. A survey conducted in low-income populations showed that cigarettes comes second after the staple food rice on the list of household monthly consumption.

Tobacco bill

Indonesia has tried to set up regulations for tobacco control by introducing a Tobacco Control Bill in 2010, the year the toddler smoking video went viral, as priority legislation. Yet neither the parliament nor the government has discussed the bill to this day.

Instead, in February the parliament has included in this year’s list of priority bills new draft legislation on tobacco. This bill is completely different from the 2010 Tobacco Control Bill.

The Tobacco Control Bill was proposed by the House’s Health Committee, while the new Tobacco Bill is submitted by the House’s Industrial Committee.

Based on the final version of the draft bill, health issues caused by smoking were not a main consideration.

The provisions are dominated by legal arrangements regarding tobacco production and the tobacco industry. Although it includes a minor provision on the protection of public health from the negative impacts of tobacco, the structure of this bill shows that health issues are not the core of the bill.

Article 3 of the bill mentions five objectives of tobacco management. The first four objective are to increase tobacco production, improve community welfare, develop the national tobacco industry and to increase state revenues.

Public health protection purposes is mentioned only last.

Industry over public health

Enacting legislation that prioritises tobacco management issues will only favour tobacco industry interests. It also gives unnecessary special treatment to tobacco farming compared to other agricultural plants.

Whenever there are efforts at tobacco control in Indonesia, the industry pits public health concerns against the welfare of tobacco farmers. Because smoking is so ubiquitous in Indonesia, there is a perception that tobacco control would jeopardise Indonesia’s tobacco farmers.

But Indonesia actually imports more tobacco than it exports to meet local demands for cigarettes. In 2011 Indonesia imported US$507 million worth of tobacco and exported tobacco worth US$146 million.

Indonesia does not need a dedicated bill for tobacco. Compared to other agricultural plants, tobacco plantations are not spread out in Indonesia’s 34 provinces. They are concentrated in only East and West Java, as well as West Nusa Tenggara.

Rice, in contrast, is evenly distributed throughout Java and other islands, with a total production of more than 70 million tonnes in 2013.

Forget the Tobacco Bill, adopt the FCTC

The Indonesian government should scrap the Tobacco Bill. The substance of the bill is not in line with the government’s efforts in protecting public health.

Indonesia has a 2009 Health Law that classifies tobacco as an addictive substance of which the production, distribution and use needs to be controlled. In 2012, Indonesia enacted a government regulation to control the health impact of tobacco products. This regulation, among other things, requires cigarette manufacturers to include pictorial health warnings on 40% of the space on every tobacco product’s packaging.

The government should accede to the Framework Convention on Tobacco Control (FCTC) and ratify it into national law.

If Indonesia continues to delay FCTC accession, the country will become a dumping ground for cigarette industries as more and more countries become parties to the FCTC. Even China, the world’s largest tobacco producer, has ratified the FCTC.

As Indonesia has rolled out its health-care system, in the long term the government will have to deal with the high health costs of smoking.

President Joko Widodo can improve his declining popularity by scrapping the tobacco bill and ratifying the FCTC. More importantly, this move will save future generations of Indonesians from the grip of tobacco industries.

Proposed Ban on Cigarette TV Ads Hits Stocks of Indonesian Media Firms

May 22nd, 2015
by Editor.
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http://jakartaglobe.beritasatu.com/business/proposed-ban-cigarette-tv-ads-hits-stocks-indonesian-media-firms/

Jakarta. Shares of Indonesian television operators have fallen over the past week due to a proposed ban on cigarette advertising on television that puts at risk a market estimated to be worth nearly $300 million last year.

Local media last week cited Mahfudz Siddiq, a parliament commission head, as saying the commission hoped to finish discussing by August an amended broadcasting law that would enforce the ban. Government officials could not be contacted by Reuters.

Over the past six sessions, shares of Surya Citra Media, Media Nusantara Citra and Visi Media Asia have posted an average drop of 2.9 percent. The broader Jakarta stock exchange rose 1.3 percent over that period.

The cigarette industry spent an estimated Rp 3.6 trillion ($274 million) on television advertising last year, according to research firm Nielsen.

The big Indonesian cigarette makers include Hanjaya Mandala Sampoerna, Gudang Garam, Wismilak Inti Makmur and Djarum Group.

“The ban is expected to be implemented and once it is implemented it will have an adverse impact on ad spending. The government has been very negative on the cigarette sector [because of the health risks],” said Harry Su, head of research at Bahana Securities.

Other consumer companies have been cutting back marketing expenses due to the slowing economy, so it may be difficult for the broadcasters to find a substitute for any lost advertising revenue from the cigarette makers, Su said.

Cigarette advertisements contribute 6 percent to 7 percent to Surya Citra’s total advertisement sales, Corporate Secretary Hardijanto Saroso told Reuters.

Cigarette companies also sponsor several popular but expensive television programmes such as soccer tournaments on Surya Citra’s television channel SCTV, Saroso said.

Visi Media Asia is waiting for clarity on the regulation, but the operator of TVOne and ANTV channels has been stepping up efforts to get advertising dollars from companies that sell sports products or motorbikes, Director David Burke told Reuters.

Tobacco industry has sights set on Indonesia, says expert

May 7th, 2015
by Editor.
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http://www.thejakartapost.com/news/2015/05/07/tobacco-industry-has-sights-set-indonesia-says-expert.html

A professor of public health at the University of Indonesia’s School of Public Health, Hasbullah Thabrany, has warned that Indonesia, one of the world’s biggest consumers of tobacco and as yet not a signatory to the WHO’s Framework Convention on Tobacco Control (FCTC), and with few regulations restricting children’s access to cigarettes, has become a main target for the tobacco industry.

“It seems that we are in a battle ground, where tobacco company owners are among the country’s richest people, making money from poor people addicted to their product,” Hasbullah said.

The National Commission on Tobacco Control (Komnas PT), together with civil and health groups concerned with tobacco control in Indonesia, has urged the government to ignore pressure from the tobacco industry, including pressure applied via the International Tax and Investment Center (ITIC).

The ITIC is widely seen to directly and indirectly fight for the cigarette industry’s agenda.

Hasbullah said that if the government wished to regain its sovereignty over the economy, as stipulated in the Nawa Cita (President Joko “Jokowi” Widodo’s nine-point development program), Indonesia must instead implement a pro-people economic policy

Manufacturers behind low cigarette taxes in RI: Commission

May 7th, 2015
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http://www.thejakartapost.com/news/2015/05/07/manufacturers-behind-low-cigarette-taxes-ri-commission.html

The National Commission on Tobacco Control (Komnas PT) is warning about the potential influence of manufacturers over the government’s ongoing efforts to determine the proper tobacco taxes that are currently being considered as a proven strategy to reduce smoking.“The cigarette industry can make such an intervention through various activities and high-level lobbying, one of which is via international institutions,” Komnas PT chairman Prijo Sidipratomo said in a release made available to The Jakarta Post on Thursday.

He said cigarette prices in Indonesia were considered very low and affordable even for young smokers; thus, the maximum increase in cigarette taxes needed to be applied to limit cigarette consumption in the country.“High taxes can lead to a jump in cigarette prices in Indonesia, allowing the government to control cigarette consumption among susceptible groups, such as poor people and children,” said Prijo.He said limiting people’s access to cigarettes through high taxes was popular in other countries, especially those that had acceded to the World Health Organization (WHO) Framework Convention on Tobacco Control (FCTC). Such a strategy was also proven as a ‘win-win’ solution for the government’s revenues and its efforts to protect people’s health from cigarette smoking impacts, he added.

The Komnas PT chairman was speaking in response to the presence of several Indonesian fiscal and financial officials in the Asia-Pacific Tax Forum held by the International Tax and Investment Center (ITIC) in New Delhi, India, from May 5 to 7.

The ITIC is among the organizations blacklisted by WHO and the World Bank (WB) as it is sponsored by four multinational cigarette companies, namely Philip Morris International, British American Tobacco, Imperial Tobacco and JTI.

The forum has drawn sharp criticism regarding, particularly, the sponsorship of the cigarette companies, forcing the WB to pull out its support. A number of financial officials from several countries also decided to not attend the forum because of the cigarette sponsorship. Unfortunately, Indonesia has decided that it will still take part in the forum. Komnas PT says the Asia-Pacific Tax Forum currently held by the ITIC is one of the interventions conducted by the cigarette industry to ensure the continuity of their business by working against efforts by countries to increase their cigarette taxes.

Manufacturers’ interventions on the government’s cigarette taxing policy can be seen when via the ITIC, an institution they are sponsoring, the cigarette companies invite representatives from various countries to attend an international forum to discuss the tax policies of those countries, the commission says

Indonesia: Cigarette warnings covered by excise bands: Survey

Apr 28th, 2015
by Editor.
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http://www.thejakartapost.com/news/2015/04/28/cigarette-warnings-covered-excise-bands-survey.html

The Indonesian Consumer Foundation (YLKI) has revealed that the pictorial health warnings on more than half of the tobacco product packages it surveyed were covered by excise bands.

“We suspect that the covering was done intentionally to blur the warning on health damage caused by smoking,” said Tulus Abadi of the YLKI at the launch of the survey of pictorial health warning implementation.

Government Regulation (PP) No. 109/2012 on tobacco control stipulates that cigarette packages circulating on the market must bear a pictorial warning that must not be covered by anything, including excise bands.

The survey, conducted from February to March, took samples of tobacco products, including products from PT Philip Morris International, PT British American Tobacco.

PT BAT had the lowest compliance with the regulation as all of the pictorial warnings on the sampled products were covered by excise bands. Local brands led in compliance with 65 percent.

Your letters: Ban tobacco advertising

Apr 22nd, 2015
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http://www.thejakartapost.com/news/2015/04/22/your-letters-ban-tobacco-advertising.html

I am a frequent visitor to Jakarta and while traveling along the road from the airport to my hotel, I saw a huge billboard advertisement for a new brand of cigarette. The art work was unimpressive, but it had a health warning on smoking.

The brand is among the top selling cigarette brands in China and is now spreading its sales globally. China is the world’s largest producer of tobacco, controlling more than 40 percent of the world cigarette market.

Already, tobacco imports into Indonesia are increasing every year, including leaves from China. Now enters the Chinese dragon to clamor for the 63 million Indonesian smokers.

Sadly, the public health community’s valiant effort to protect people, especially children and the poor, from tobacco use has come under attack. The tobacco industry has mobilized farmers to brand health advocates the “enemies of farmers”. The industry claims, without proof, that many millions of tobacco growers and workers will become unemployed. But who is the real enemy of the local tobacco growers?

A few misinformed researchers and individuals have labeled the global tobacco treaty, the World Health Organization Framework Convention on Tobacco Control (WHO FCTC), as a “western conspiracy” to sell pharmaceuticals.

They are oblivious to the real enemy of the people, which is the dragon-like tobacco industry breathing out a trail of destruction for the medical profession and the Health Ministry to clean up.China ratified the WHO FCTC in 2005 and their tobacco industry didn’t die, instead cigarette sales grew by 20 percent (from 1.88 trillion sticks to 2.32 trillion sticks) between 2005 and 2010.

About 4 million Indonesian children are smoking and children under 10 years addicted to cigarettes are commonplace. Indonesia must do better to protect its people, especially children, from the totally preventable 200,000 deaths every year from tobacco-related causes. Tobacco advertising must be banned nationwide. Indonesia should accede to the FCTC as soon as possible.

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