Clear The Air News Tobacco Blog Rotating Header Image

NGO questions Japan Tobacco’s claim

By Grace Ting-ann Lee, Special to the China Post

TAIPEI, Taiwan — The John Tung Foundation (董氏基金會) has questioned Japan Tobacco Inc. (傑太日煙) about its claims of injecting over NT$9 billion in foreign capital into a tobacco plant being built in Greater Tainan.

In a press conference yesterday, the nongovernmental organization stated that “it is all a lie and the money is coming from Taiwan citizens’ pockets.”

Japan Tobacco raised the price on 21 kinds of Japanese cigarette brands on Wednesday by NT$5 to NT$10 per pack. The NGO said that the money earned by the price increase is meant to pay for the construction of a NT$9 billion tobacco plant.

“There was no foreign capital all along,” said John Tung Foundation CEO Yao Si-yuan (姚思遠). “In other words, Taiwan people are establishing tobacco plants that harm our own people.”

“Many people have complained that the health costs around cigarettes is growing gradually, yet the government has not adjusted taxes on cigarettes since 2009,” said Lin Ching-li (林清美), a member of the foundation, stating that the Japan Tobacco has raised prices several times, by NT$10 to NT$30 per pack each time.

While NGOs have demanded that the government stop the plant’s construction, the Greater Tainan government has claimed that it would help the local economy.

Moreover, the construction is already halfway completed and under the Investment Agreement between Taiwan and Japan (台日投資協議), local authorities cannot halt construction, the Greater Tainan government said.

The Ministry of Health and Welfare also stated that the cigarettes are for export and will not affect the health of people in Taiwan.

“However, there is no provision that the cigarettes produced can only be exported,” Yao said.

With over 35 percent of market share in Taiwan, the John Tung Foundation stated that about 700 million packs of Japan Tobacco products are sold in Taiwan per year. Through price hikes and the tariff saved due to the investment agreement, Japan Tobacco earns over NT$13 billion from Taiwan every year, “and this does not include other tax concessions, which cannot be counted.”

The foundation pointed out that the Investment Agreement between Taiwan and Japan is one-sided with regard to tobacco production. Japanese companies can invest in Taiwan while Japan remains closed to Taiwan, Yao said.

“Investment agreements between nations should be equal … (The inequality) shows that our government neglects the health of people and tobacco hazard prevention,” Yao said.

The NGO said that it hopes that the government will stop the construction immediately.

“According to the Investment Agreement between Taiwan and Japan, if there are more important public policies to achieve, the government can choose to expropriate (projects) under due process, if there is a legal public purpose and if there is compensation,” Yao said.

”There is a price to pay,” Yao added, “but if you are not willing to pay it, it would cost you much more in the future.”

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>