Home / Agriculture/ Expenditure on tobacco use tops GSP Plus export income, annual milk powder bill

Expenditure on tobacco use tops GSP Plus export income, annual milk powder bill


Comments / {{hitsCtrl.values.hits}} Views / Friday, 6 July 2018 00:00


 

  • $ 662 m annually spent by Lankans on cigs, tobacco: RishadSays cost exceeds EU GSP Plus revenues
  • Govt. switching farmers to alternate crops of high income: Rishad  

 The Sri Lankan consumers’ annual expenditure on cigarettes and tobacco is so high it surpasses the country’s annual bill on milk powder imports. This tobacco expenditure also exceeds another income-the annual export revenue from EU GSP Plus.

“Reports say that Sri Lankan consumers spend more than Rs. 200 million per day for cigarettes. According to the World Health Organization in 2015 the direct and indirect cost of tobacco use in Sri Lanka was estimated at Rs. 89 billion or $ 662 million,” said Minister of Industry and Commerce Rishad Bathiudeen on 26 June, addressing the launch event of tobacco farmer research report titled ‘Farmer Perspectives on Proposed Tobacco Growing Ban and Opportunity to Diversify’ by Dr. Chatura Rodrigo of Green Space Consultancies (GSC).  

“In that, we annually spend more than $ 660 million for tobacco use and resulting expenses. When we compare this $ 660 million with some other important values we can understand the huge cost for the economy from tobacco use,” said Bathiudeen.

He added: “For example we spend $ 400 million a year to import milk powder to be used by our households and hotels. The $ 660 million we spend for tobacco use is 55% higher than our annual bill for the milk powder imports. The other example is that Sri Lanka’s annual expenditure on tobacco use is even higher than the additional export income from EU GSP plus which is around $ 480 million. In that, our annual tobacco and cigarette expenditure is 37% higher than our annual GSP Plus income alone. Another example is that this annual tobacco cost is equal to total flood and landslide damages incurred by Sri Lanka in both 2015 and 2016.

“These simple examples show the huge cost to our economy from tobacco use. Therefore realising this the Government is making attempts to switch the tobacco economy to a more productive livelihood stream with alternative, export driven crops. As for tobacco production it is reported that more than 3,300 metric tons of tobacco are produced in Sri Lanka. When it comes to cultivation only a very small percentage of lands are used at 0.07% of all agricultural lands only taken by tobacco.”

Tobacco expert panel at the event indicated that tobacco is considered as an industrial crop, more than a commercial crop and since the bulk of the harvest is used for nicotine products, it immediately ends up in industrial/machine processing, unlike many other commercial crops. Among all types of full time farmers in Sri Lanka, tobacco farmers are one of the most profitable, earning regular margins of 20% or higher.

The ban on tobacco cultivation in Sri Lanka is scheduled to start from 2020. Importation of cigarettes and tobacco also will be banned from 2020.


Share This Article


DISCLAIMER:

1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.

COMMENTS

Today's Columnists

Courting democracy; Housing disaster?

Thursday, 15 November 2018

A small step was taken by a sovereign court the day before yesterday. It was a giant leap for the supremacy of the Constitution over all three arms of government in a recently benighted Sri Lanka. As well as being the tangible proof of intra-governme


Sri Lanka’s Judiciary in its finest hour

Thursday, 15 November 2018

“We must never forget that the only real source of power we as judges can tap is the respect of the people” –Justice Thurgood Marshall


When scholars turn slayers of reason

Thursday, 15 November 2018

“… I think, that the intellectual is an individual endowed with a faculty of representing, embodying, articulating a message, a view, an attitude, philosophy or opinion to, as well as for, a public. And this role has an edge to it, and cannot be


A stable democracy is a prerequisite for the wellbeing of Sri Lankans

Thursday, 15 November 2018

In Sri Lanka, despite the complexity of overlapping policies, the slow pace in implementing economic policies has been of central concern in the past few years. The current political state in Sri Lanka poses a series of e


Columnists More