Sri Lanka’s tough tobacco policy up in smoke?

• Finance Minister envisages foreign cigarette imports

Sri Lanka’s usual stringent policy on tobacco took a twist no less yesterday, World No Tobacco Day, when Finance Minister Mangala Samaraweera announced the Government is considering importation of foreign cigarettes. 

The Minister made these comments at a media briefing held in Colombo on Thursday, adding that there was significant demand for foreign cigarettes amongst expatriates, and that it would consider applications for such imports. The Government earns over Rs. 120 billion annually from Sri Lanka’s tobacco industry, which boasts one of the highest prices in the world due to taxation, with strict restrictions on sales and public smoking.

Such controls were the result of anti-smoking campaigns spearheaded by President Maithripala Sirisena and Health Minister Dr. Rajitha Senarathne, whereby it would be interesting to note their reaction to this proposal by the Finance Ministry. Both the President and Health minister have been awarded by the World Health Organization for their contribution to combat smoking in Sri Lanka.

Sri Lanka’s sole cigarette manufacturer is Ceylon Tobacco Company, part of British American Tobacco, in a market with little over 3.5 billion sticks annually and a fully vertically integrated operation with leaf growing, employing over 20,000 farmers in the country. 

Despite the stringent rules on the legal industry, which includes graphic health warnings on cigarette packs, smoking incidence remains high due to the unchecked and unrestrained growth of the beedi industry, which enjoys a significant price advantage of over 90%. This is in addition to smuggled illicit cigarettes which reach the country, and an estimated 600 million sticks cause significant revenue loss to government. 

Minister Samaraweera’s proposal to consider allowing foreign cigarette imports come as a surprise when Sri Lanka over the last 15 years had set a ban on public place smoking, sales ban for persons under 21, introduced graphic health warnings and implemented a strict excise regime to control smoking 

Ironically the announcement came on World No Tobacco Day which falls on 31 May, with the global campaign converging to combat the harmful impacts of tobacco use and second-hand smoke. The focus this year falls specifically on ‘Tobacco and Lung Health’ in order to build awareness on the risks from cancer to chronic respiratory disease and the well-being of people. Once more, the campaign led by the World Health Organization calls for effective policies to reduce tobacco consumption.

A study conducted by the Open University of Sri Lanka found that over 580 million illicit cigarette sticks make their way into our market, resulting in over Rs. 18 billion in losses to the State annually.