Regulatory Effectiveness: How Nigeria and other African Countries can learn from the EU on Tobacco Regulation – IMANI


An IMANInsight Review


The fight against tobacco consumption which commenced decades in some jurisdictions and became a global phenomenon, is taking a different dimension and approach. Unfortunately, over the years in Africa, we have become a symbolic laggard. However, we can take centre stage and lead the policy reforms that will show that we have indeed learnt from the mistakes and experiences of the advanced countries and continents who decades ago “cracked the whip” harder on tobacco usage and in the process created more harm than perceptive good.

The main schools of thoughts on the control and regulation of tobacco have been polarised along the lines of “pro” and “anti” tobacco lobbyists. Suffice to say that both schools of thought have successfully identified sufficient scientific evidence to support their claims making it difficult for the policy maker to sift through critical details concerning regulation. The challenge of the policy maker is not the scientific evidence available, but the cause and effect of “cracking the whip” and whether it is the most appropriate mechanism of dealing with tobacco.

The European Union, and States such as California in the US were among some of the first jurisdictions to have instituted strict measures to control the display of tobacco products, institute advertising bans, and introduce high taxes on the industry among others as measures to protect their societies from the “devastating” effects of the use of the product. After decades of such draconian mechanisms globally, the evidence to support the effectiveness of these measures, appear not to be completely supportive of them. In fact in jurisdictions where there has been marginal improvements in the consumption of the product, these could not completely be attributed to the strict impositions. The mixed nature of the evidence  with majority tilting towards the spurring of illicit drug trade, crippling the industry calls for a further interrogation of the evidence across major jurisdictions and how Africa can learn from them.

In New York for instance, an average of $12 tax per pack on cigarettes has sparked and grown the illicit trade far beyond measure, meaning the state government is losing out on the projected tax revenue estimated at about $80 Billion, without preventing the consumption. Throwing into the mix the links between smugglers and terrorist groups such as Hezbollah, Al-Qaida and Hamas, makes the cycle of loss to the state an unending one as besides the loss in revenue, expenditure on security provision will increase and crime rates will be on the ascendency. Thus tighter regulations with the pious objective of saving the youth, practically drive illicit trade, where the smugglers don’t check ID’s for minors, thus making them an alternative supply source for the youth. The concomitant effects are just grave.

Garry Grant, retired Toronto police officer and spokesperson for National Coalition against Contraband Tobacco, laments “its [illegal tobacco] also sold through a criminal distribution network that connects cigarettes to kids without the hassles of checking for ID or travelling out of the way. This dangerous combination of low price and easy accessibility has made illegal cigarettes a prime source for youth smoking.” In a case where proceeds from the sale of illegal tobacco funds over 175 gangs in Ontario, Canada, means strict measures of control could not be the way out. What if it was legalised and regulated? Will the outcome be different?

Ireland has had its fair share of negative effects of tight regulation and control despite being one of the countries in Europe to pursue them. The Irish Times reports that close to 29 percent of all tobacco products in the country are illegal, and costs the country about €250 Million per year. Despite the evidence staring the regulators in the face, the country still focuses on increasing resources to the authorities to go after smugglers. Why spend so much as a country on something that has not been eliminated under the strict supervision of wardens in prisons and penitentiaries? Perhaps the evidence is signalling that alternative measures should be resorted to.

The challenge is not for just the developed countries. In Pakistan, it is alleged that one out of four cigarettes sold is either smuggled or counterfeit, and this is as a result of strict and rigid control mechanisms instituted purportedly to save consumers of tobacco and its related products. With a tax rate per packet of cigarette hovering around 70 to 80 percent, it does not follow that the government will lose close to $1 Billion by 2017, unless of course the unintended consequences are as real as can be. The consistent increase in tax on the industry of the 5-year period from 2007 to 2011 of about 60 percent seldom translated into decline in consumption which remained constant over the period[1]. The illicit trade is costing both industry and government, limiting their revenue accruing from the industry as a result of draconian regulations.

The European Union Parliament recently relaxed some proposed tighter regulatory directives spearheaded by governments in the region. The move according to some analysts is victory for pro tobacco lobbyists. Here is the thing; both pro tobacco lobbyists and anti-tobacco crusaders want the same thing-decrease the negative effects of tobacco, however they propose different approaches. The “war” on the negative externalities will not be won when we perceive changes in regulations as victory for one group and the defeat of the other. At best, one approach; draconian methods, has done little over the past decades in dealing with the problem, than to cost governments and industry money, and scarce resources, with the UK government loosing close to £2 Billion. This leaves one no choice than to question the extent to which the World Health Organization’s framework convention on tobacco control has helped the situation. Countries that have ratified the convention such as those mentioned above, have not seen the perceived benefits thought to have been realised. For instance, Article 6 of the convention proposes price and tax measures to reduce the demand for tobacco. The evidence from across Europe shows that, demand and consumption has been on the ascendency only through illegal/black markets, where the dangers thought to be prevented are more onerous.  The proposition by other groups has never been considered and even the industry has not been fully engaged in this debate, despite the fact that it still remains a legitimate industry across the globe.

It is said that winning strategies are never changed but improved, whiles failing ones are changed. It only means another approach to solving this problem be resorted to, and it is quite progressive that the EU is beginning to engage the industry to identify ways by which the menace could be dealt with and to some extent shy away from draconian principles, which have made the region lose resources; a bad experience. This could only mean one thing for African countries, who have less resources to throw away to smugglers, peddlers, illicit traders, and most of all to fight the nuances of draconian policies; review current systems/policies for fighting tobacco, maybe rethink strict and tight regulations including high taxes, and engage the industry more in resolving this challenge.

What Nigeria and other African Countries can learn from the position of EU?

It is obvious that with all the propositions and conventions present today, the “whip” has not been an effective tool in dealing globally with tobacco. The fundamental fact that the main actors; industry and consumers, have not been directly engaged in the debate has been a fundamental flaw to virtually all approaches that have been used. From 2003 for instance when the World Health Organization passed the convention for tobacco regulations, and called for more stricter mechanisms through price and tax controls, non-price and tax controls, public education about the risk of consumption, advertising and display bans, training of public officials to deal with the issue effectively, the world has little to show for such draconian measures.

At best, high cost of dealing with externalities of the implementation of these policies, loss of revenue to both governments and industry, increase in drug and tobacco related crimes and increase in tobacco consumption is what these countries have to show. This is why the debate is changing globally, and the fear is that, Africa which has always been a laggard on some of these issues might miss out on an opportunity to shorten its learning curve. It has taken the developed countries decades to have this experience, but Nigeria and other African countries have a case study (experience) to learn from. Nigeria does not have the resources to splash around for the next 60 years before it realises this is not the way to go. Even if we had the resources, we do not need to waste them, and most importantly put more lives in danger by helping the illegal market to flourish. With drug cartels increasing their tentacles into frontier markets to solidify their trade and network, it will be imprudent not to review current systems, and engage industry and consumers to find appropriate mechanisms such as co-regulation, to protect the youth and prevent the sale of tobacco products to minors.

The evidence and experience of other countries and regions that pursued draconian policies against tobacco stares us in the face, we must look at and learn from these experiences, and not succumb to external pressures in this country and on the continent, to seize the opportunity to make history, than to be writing it 60 years from today.

IMANInsight is a platform for researching and advocating common sense public policy. It is part of IMANI Ghana. 
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