Tobacco Consumers, Companies And Effects In Bangladesh

What is tobacco?

Tobacco is a plant native to the Americas which is grown all over the world. Its leaves contain high levels nicotine and many cancer-causing chemicals. Tobacco leaves can be smoked as cigarettes, cigars, and hookahs; applied to the gums as dipping and chewing; or inhaled. Tobacco use and secondhand tobacco smoke causes many types of cancer, as well as heart, respiratory, and other diseases.

Consumers

About 5.7 trillion (5,700,000,000,000) cigarettes were smoked worldwide in 2016. Although overall consumption has declined slightly over the past few years, the future path of global tobacco control is still uncertain. Despite the rhetorical commitment of some in the tobacco industry toward a smoke-free world, all major tobacco companies continue to aggressively advertise cigarettes and vigorously fight tobacco control efforts around the world. The significant reductions in smoking rates in the United Kingdom, Australia, Brazil, and other countries that have implemented the most advanced tobacco control laws globally are almost entirely offset by the increasing consumption in many countries with weaker tobacco control regulations.

Cigarette consumption is predicted to increase in many low- and medium-HDI countries due to dynamic economic development and continued population growth. For example, the number of tobacco smokers is set to increase by 24 million in Indonesia and by 7 million in Nigeria from 2015 to 2025. China, whose people smoke more than 40% of all cigarettes globally, remains a challenge. Although cigarette use in China has begun to decline, half of Chinese adult males continue to smoke cigarettes. Without appropriate prevention policies, the world will lose a billion lives this century due to tobacco smoking.1

Largest markets worldwide

The five largest cigarette consuming nations ― China, Indonesia, Russia, U.S. and Japan ― account for 61.7% of the volume of all cigarettes sold in 2017. China is the largest cigarette market in the world. The retail value of China’s cigarette market in 2017 was US$212.3 billion. High tar cigarettes dominate the market. However, their sales are decreasing while sales of lower tar cigarettes are increasing. In 2017, the volume sales of cigarettes increased by 0.8% compared to 2016, marking the first increase in volume sales since 2013-2014.3 Real retail value increased by 3.0%. Since the peak of global cigarette volume sales in 2012, the global cigarette market volume has decreased by 9.2%, but it declined by more (13.0%) when excluding China’s retail volume. In Russia, cigarette sales by volume has declined by 25.2%between 2013 and 2017.3 Over the same time period, real retail values increased by 31.3% to US$26.9 billion. Between 2016 and 2017 alone, retail volume fell by 7.2%, while real value of sales grew by 3.6%.3 With a 33.6% market share, J T is the market leader in Russia, but P M I, B AT and Imperial also have a presence. The Indonesia cigarette market is unique because sales are dominated by kreteks (cigarettes made with a blend of tobacco and cloves). Between 2016 and 2017, the Indonesian cigarette market declined by 2.5%, marking the second consecutive year of decline in sales volume.3 One of the two leading tobacco companies, Sampoerna, was acquired by P M I in 2005 and outperforms all domestically-owned companies and all other T T Cs trying to make a profit in Indonesia. In India, smokeless tobacco and bidis (small, hand-rolled smoked products) are much more popular than cigarettes: About 75% of all tobacco users use smokeless tobacco, 27% smoke bidis, and only 14% of all tobacco users smoke cigarettes. While cigarettes are not the most popular tobacco product in India, approximately 81.3 billion cigarettes were sold in 2017, making the country an important target for international tobacco companies.2

Tobacco companies

While cigarette sales are expanding to new markets, industry market shares are consolidating, and the market is increasingly controlled by a few international companies. In 2001, a little more than 43% of global market sales were controlled by the five leading transnational tobacco companies (T T C). By 2017, 80.6% of the market was controlled by T T Cs. Over the last decade, the international cigarette market has been dominated by five companies: China National Tobacco Corporation, Philip Morris International, British American Tobacco, Japan Tobacco Inc. and Imperial Tobacco.

China National Tobacco Corporation (C N T C) is owned and operated by the Chinese government and is the world’s single largest producer of cigarettes with 42.6% of the global market. C N T C sells the majority of its product in China; just over 1% of cigarettes produced are exported to other countries. C N T C is increasing efforts to sell heritage brands such as R D G, Dubliss and Harmony internationally. Philip Morris International (P M I) is a publicly traded American company with headquarters in Lausanne, Switzerland. P M I controls an estimated 14.1% of the international cigarette market. Since separating from its parent company, Altria, in 2008, P M I only sells its tobacco products outside of the United States. The company operates in more than 180 markets and sells 6 of the top 15 brands, including Marlboro, the world’s top selling brand. P M I experienced declining cigarette volume sales in all regions between 2016–2017, as the company focused on expanding sale of its heated tobacco product, I Q O S. I Q O S has done particularly well in Japan and South Korea. British American Tobacco (B AT) is a publicly traded company based in London. B AT operates in over 200 markets, is the third largest company in the global tobacco market, and controls 11.8%of the international cigarette market. Top selling brands include Pall Mall, Rothmans, Kent, Dunhill, and Lucky Strike, and these five brands account for half of all BAT cigarette sales. Acquisition of Reynolds American, Bulgartabac, and other tobacco companies contributed to overall growth in volume and value of the company in 2017. BAT cigarette sales volumes grew strongly in Bangladesh, Bulgaria, Nigeria, and Gulf Cooperation Council countries, but declined in many other key markets. Japan Tobacco, Inc. (J T) is headquartered in Tokyo and the parent company to Japan Tobacco International (J T I), which is headquartered in Geneva, Switzerland. International tobacco sales account for more than 60% of J T’s operating profit. With products available in 130 countries, J T is the fourth largest tobacco company in the world, and controls 8.4% of the global cigarette market. The Japanese government holds 33.3% of J T’s issued shares. Top brands include Winston, Camel, Liggett Ducat, and Mevius (formerly Mild Seven). J T I continues to expand its presence in emerging markets, with the largest volume growth in Brazil, Egypt, Iran, the Philippines, and Tunisia, and company acquisitions in Indonesia and the Philippines in 2017. Imperial Tobacco Group is a British company. It is the fifth largest company participating in the global tobacco market and controls 3.7%of the international cigarette market. Imperial operates in more than 160 markets, and key growth markets are in Italy, Russia, Japan, and Saudi Arabia. Top brands include West, Davidoff, John Player Special, and Gauloises.

Who produces tobacco in Bangladesh?

British American Tobacco Bangladesh (BATB) is the number one tobacco company in tobacco industry of Bangladesh, which was incorporated in 1972. The cigarette market in Bangladesh, as in much of the world, is highly concentrated. The premium segment of the market in Bangladesh is dominated by British American Tobacco Bangladesh (BATB), a subsidiary of multinational tobacco company British American Tobacco. British American Tobacco holds 62% of the cigarette market by volume and Dhaka Tobacco Industries (under Akij Group) used to hold 21.3% of the cigarette market before the acquisition of the company by Japan Tobacco International (JTI) in 2018.

Philip Morris International distributed its products in Bangladesh through Dhaka Tobacco Industries (DTI). In 2007, DTI entered into an agreement with Philip Morris international to market Marlboro cigarettes in Bangladesh.

The largest local tobacco company was Dhaka Tobacco Industries (DTI), it was a part of the Akij Group and now a part of Japan Tobacco International (JTI). DTI dominated the market for lower-priced cigarettes. Smaller domestic companies include Abul Khair Tobacco and Nasir Tobacco. In 2017, 88.9 billion cigarettes were sold in Bangladesh.2

By contrast, bidi manufacture in Bangladesh is more fragmented, with AkijBidi Factory, Ltd. (another part of the Akij Group) the largest firm, accounting for over one-quarter of the market, and the top 4 firms accounting for less than 50% of the market.

The cigarette industry is growing at a rate of 3.4%. The Biri market which was 70.3% of the total market is declining, now it is 69%. The smokers are upgrading from biri to low segment of cigarettes. Besides these, some other companies are: AlphaTobacco Company, Sonali Tobacco, AbulKhair Group, Nasir Gold Tobacco, Imperial Tobacco etc.

Effects of Tobacco

The effects of any drug (including tobacco) vary from person to person. How tobacco affects a person depends on many things including their size, weight and health, also whether the person is used to taking it. The effects of tobacco, as with any drug, also depend on the amount taken.

Some of the effects that are likely to experience through smoking:

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• initial stimulation, then reduction in activity of brain and nervous system
• increased alertness and concentration
• feelings of mild euphoria
• feelings of relaxation
• increased blood pressure and heart rate
• decreased blood flow to fingers and toes
• decreased skin temperature
• bad breath
• decreased appetite
• dizziness
• nausea, abdominal cramps and vomiting
• headache
• Coughing due to smoke irritation.

Higher doses:

A high dose of nicotine can cause a person to overdose. This means that a person has taken more nicotine than their body can cope with. The effects of very large doses can include:

• an increase in the unpleasant effects
• feeling faint
• confusion
• rapid decrease in blood pressure and breathing rate
• seizures
• respiratory arrest (stopping breathing) and death

Long-term effects

Tar in cigarettes coats the lungs and can cause lung and throat cancer in smokers. It is also responsible for the yellow–brown staining on smokers’ fingers and teeth.

Some of the long-term effects of smoking (Quit Victoria, 2010) that may be experienced include:

• increased risk of stroke and brain damage
• eye cataracts, macular degeneration, yellowing of whites of eyes
• loss of sense of smell and taste
• yellow teeth, tooth decay and bad breath
• cancer of the nose, lip, tongue and mouth
• possible hearing loss
• laryngeal and pharyngeal cancers
• contributes to osteoporosis
• shortness of breath
• coughing
• chronic bronchitis
• cancer
• triggering asthma
• emphysema
• heart disease
• blockages in blood supply that can lead to a heart attack
• high blood pressure (hypertension)
• myeloid leukemia, a cancer that affects bone marrow and organs that make blood
• stomach and bladder cancers
• stomach ulcers
• decreased appetite
• grey appearance
• early wrinkles
• slower healing wounds
• damage to blood vessel walls
• increased likelihood of back pain
• increased susceptibility to infection
• lower fertility and increased risk of miscarriage
• irregular periods
• early menopause
• damaged sperm and reduced sperm
• impotence

CSR of Phillip Morris International (PMI)

To increase goodwill among policy makers and the public and to counter tobacco control efforts, PMI participates in a wide range of “community investment” initiatives across the globe. PMI engages in so-called socially responsible activities while simultaneously manufacturing a product that is responsible for disease, disability and ultimately death of its customers. In 2009, PMI reported engaging in 392 “corporate social responsibility” efforts in about 46 countries, ranging from contributions for education and disaster relief efforts to funding medical services for tobacco farmers.

• In 2009, PMI donated over $5 million USD to the Putera Sampoerna Foundation in Indonesia for education projects.
• $2.7 million USD was given to Washington State University for a project to enhance rural livelihoods in Malawi.
• The total amount of 2009 corporate contributions disclosed on PMI’s website was $22.7 million USD (a mere fraction of PMI’s 2009 net revenues of $25 billion USD.)

PMI’s “community investments” to selected countries in 2009, Indonesia $6,764,673, Russia $2,125,179, Philippines $1,199,740, Mexico $502,188, Pakistan $381,510, Brazil $370,492, China $246,798, Poland $196,244, Thailand $183,919, Ukraine $126,253, Vietnam $98,275.4

CSR of British American Tobacco

To improve its image and weaken tobacco control efforts, BAT engages in “community investment” initiatives, while simultaneously causing the disease, disability and ultimately death of its customers. In 2009, BAT reported £14 million ($22.7 million USD) in so-called corporate social responsibility (CSR) expenditures toward charitable projects such as youth smoking prevention, sustainability, preserving biodiversity, disaster relief, and the elimination of child labor in tobacco farming. These efforts do little to address the root causes of social problems and often result in the exploitation of the communities involved.

• BAT claimed to tackle underage smoking in Russia through youth smoking prevention (YSP) programs. However, studies show that tobacco company-sponsored YSP programs do not reduce smoking, but instead encourage youth smoking.
• BAT sponsors Jua Kali, the annual East African exhibition for local craftspeople, in order to gain publicity, advertise its products, and meet local politicians.
• BAT co-founded the Eliminating Child Labor in Tobacco Growing Foundation (ECLT) in 2000 as a CSR effort rather than taking meaningful action to eradicate child labor. BAT contributed $2.3 million over four years to fund ECLT development projects that were generally unrelated to child labor while earning $40 million USD from unpaid child labor in Malawi within the same time period.
• In Kenya, BAT claims to support local farmers and their families by providing loans for seeds, pesticides, and fertilizers. However, many of these farmers suffer from the health hazards of tobacco growing and often end up in debt to BAT.
• BAT’s Indonesian subsidiary, Bentoel, donated 115,000 food packages to 86 foundations and orphanages in Malang in 2009. Bentoel’s main factory located in Malang produces many of its deadly brands.
• BAT awarded the Albino Souza Cruz state primary school with a $100,000 rolling grant to improve school facilities. The school is named after the founder of Souza Cruz, BAT’s subsidiary in Brazil.
• In 2007, Souza Cruz contributed $14.9 million Reals ($8.4 million USD) to CSR activities supporting educational programs, youth engagement, and the environment while subsequently contributing to the 200,000 annual deaths due to smoking in Brazil.5

CSR activities of BAT in Bangladesh

Afforestation: BAT Bangladesh’s flagship CSR program

British American Tobacco Bangladesh (BAT Bangladesh) initiated its afforestation program in 1980 when the forest department called on the private sector to support its endeavor to conserve the forests. So far, BAT Bangladesh has contributed around 79.5 million saplings to the country’s afforestation initiative in the last 34 years. It is presumably the largest private sector driven afforestation effort in Bangladesh.

The Project has also won international recognition for the company recently when BAT Bangladesh was awarded Asia Responsible Entrepreneurship Award in 2014 under Green Leadership by Enterprise Asia, a non-governmental organization striving for the pursuit of entrepreneurship development in Asia Region. As a national recognition for special contribution in tree plantation, BAT Bangladesh has received National Award for five times in the year 1992, 1999, 2002, 2005 and 2007. The program is designed to focus on the socio-economic needs of the human society as well as overall environmental perspectives.

Having recognized the gravity of water and sanitation and in the context of the Millennium Development Goals, BAT Bangladesh has stepped forward with a safe drinking water project. As a part of the safe drinking water initiative, BAT Bangladesh has already installed 53 filtration plants to make water free from arsenic and other harmful contents in arsenic prone areas in the country. All the 53 plants now purify 270,000 liters of drinking water, meeting the need of 135,000 people every day. The plants are maintained by local committees consisting of members from local communities. More than hundred communities in rural areas with the safe drinking water plants are now living a better life than before as safe drinking water is enriching their livelihood.

BAT Bangladesh is providing Solar Home Systems free of cost to rural communities of the country which are currently out of electricity. So far, the Company has installed 1,366 units of solar home systems in 15 villages of Bandarban and Khagrachari districts, illuminating the community and its people in the off-grid areas of the country. Now, more than 8000 rural people are connected with electricity for the first time. This initiative will continue its journey to kindle hope in remote rural communities by bringing in a completely new dimension in the lives of people and progressing it with the power of energy.6

CSR of Japan Tobacco International

To increase goodwill among policymakers and the public and to counter tobacco control efforts, JT and JTI participate in a wide range of “community investment” initiatives across the globe. The tobacco company engages in so-called socially responsible activities while simultaneously manufacturing a product that is responsible for disease, disability and ultimately death of its customers. This is a tactic to increase positive public opinion by distracting the consumer from the negativity that is caused by its products. One way that JT engages in corporate social responsibility (CSR) is by promoting ineffective youth prevention campaigns. In Japan the company created the Youth Smoking Prevention Council and rolled out an educational campaign using newspaper advertisements to target to youth specifically. However, industry-sponsored youth prevention programs have been proven to be ineffective at reducing youth tobacco use, and they may even encourage youth to smoke. When compared with public health programs, industry-sponsored prevention programs are less appealing and less convincing to youth. Internationally, JTI attempts to influence policy makers and public perception by promoting different CSR activities to counteract its bad reputation. For example, in Africa, JTI focuses on reforestation in Malawi and Tanzania- two of the leading tobacco leaf producing countries where tobacco leaf production is responsible for a large portion of deforestation. JTI also supports the Eliminating of Child Labor in Tobacco-growing (ECLT) Foundation in Africa, an organization founded by BAT as a CSR program in 2000. According to a 2006 study, the ECLTs has not been effective in dealing with the issue of child labor on tobacco farms in Africa. Additionally, in 2001, JTI found the JTI Foundation based in Switzerland. The main function of the foundation is to provide disaster relief around the world by partnering with local organizations in the affected region. While the JTI Foundation’s website and branding is not similar to either JTI or JT, the company still benefits greatly from name recognition. The JTI Foundation and other CSR activities are tactics used by JT/JTI to present itself to policymakers as a responsible company and not just one associated with the sale of deadly products for profit.7

Evaluation of CSR Activities

Purpose – Given the well-documented outcomes of corporate social responsibility (CSR) activities, tobacco companies that exhibit CSR may be trusted and consumers may hold positive attitudes towards tobacco companies further contributing to and reinforcing smoking behaviors, which is a highly undesired and addictive behavior. CSR activities are able to cultivate favorable images of the tobacco companies especially for those who are currently smoking. Moreover, findings show that consumer-company identification does not affect company evaluation (CE) and consumer sensitivity towards corporate social performance becomes a motivator which positively affects CE among smokers.

In spite of all the CSR activities done by tobacco companies, it is never effective towards the side effects it causes. In their CSR activities there’s nothing curing or reducing the harm that it does to human body. Tobacco companies doing CSR activities just as a brain wash towards their consumers. Government is considering their CSR activities sufficient. Thus, tobacco is an ultimate cause of total malfunction in human life. No matter what tobacco companies are doing, those are not enough as it does nothing for the harm tobacco does.

References

1. Consumption, 2019. Retrieved from https://tobaccoatlas.org/topic/consumption/
2. THE GLOBAL CIGARETTE INDUSTRY. Retrieved from https://www.tobaccofreekids.org/assets/global/pdfs/en/Global_Cigarette_Industry_pdf.pdf
3. The Toll of Tobacco in Bangladesh, 2019. Retrieved from https://www.tobaccofreekids.org/problem/toll-global/asia/bangladesh
4. Phillip Morris International (PMI). Retrieved from https://www.tobaccofreekids.org/assets/global/pdfs/en/IW_facts_company_pmi_profile_july2010.pdf
5. British American Tobacco (BAT). Retrieved from https://www.tobaccofreekids.org/assets/global/pdfs/en/IW_facts_company_bat_profile_aug2010.pdf
6. Our corporate social responsibility. Retrieved from http://www.batbangladesh.com/group/sites/BAT_9T5FQ2.nsf/vwPagesWebLive/DO9T5K52
7. Japan Tobacco Inc and Japan Tobacco International. Retrieved from https://www.tobaccofreekids.org/assets/global/pdfs/en/Japan_Profile.pdf