Economy

China advised to 'put a brake' on tobacco industry

(Xinhua)
Updated: 2011-06-01 15:02

BEIJING - Chinese policymakers should consider putting a brake on the growth of the country's tobacco industry, which produces one third of the world's cigarettes, a prominent economist and policy advisor has said.

Hu Angang, director of the Research Center for Contemporary China at Tsinghua University, said in an interview with Xinhua that the tobacco industry "can not be allowed to grow any stronger."

Industry figures show that China produced 2.38 trillion cigarettes in 2010, rising a staggering 40 percent over the past decade. The tobacco industry currently generates about 7 percent of the government's annual revenue.

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But the country's tobacco revenue has been overshadowed by lost productivity and the overwhelming medical costs linked to tobacco-related sickness and deaths since 1999, Hu said in the interview just before the World No Tobacco Day on Tuesday.

Last year, the cost incurred by people smoking outweighed the tobacco profits and jobs created by 61.8 billion yuan ($9.5 billion), Hu said, citing one of his recent studies published earlier this year.

"If we take into account that tobacco kills 1.2 million Chinese every year, the tobacco industry's 'contribution' to society is not even worth mentioning," he said.

Hu said the Chinese policymakers should take advantage of the state monopoly to put a lid on the tobacco industry's growth, reducing its production and profits while encouraging tobacco industry workers to seek other jobs.

There are about 300 million adult smokers in the country. Millions of Chinese also rely on the tobacco business, from farming to retailing, for a living, industry estimates show.

Hu said the phasing-out process would be gradual as even in countries with aggressive tobacco control efforts the smoking rate drops less than 1 percent annually.

"It would take about two or three decades. China is expected to maintain a substantial number of smokers for 30 years so the economy of the regions heavily reliant on tobacco production will not be choked," Hu said.

Hu said he was preparing a report on the tobacco industry restructuring to the senior leadership but did not disclose any details.

The economist also proposed the setting up of a state tobacco control bureau under the National Development and Reform Commission, the country's top economic planner, to lead tobacco control efforts.

China has ratified the World Health Organization Framework Convention on Tobacco Control (WHO FCTC). But the treaty's implementation is in the hands of a multi-agency work group that includes the State Tobacco Monopoly Administration, the regulatory body that shares the same management staff with China National Tobacco Corporation.

Calls to kick tobacco industry representatives out of the multi-agency work group in charge of implementing the WHO treaty have been mounting in the health sector for some time.

"The success of China's tobacco control campaign largely hinges on the political will and actions taken by the leadership," Hu said. "The government should deal with the matter with the same focus as it has given on HIV/AIDS control."

"Without China's success, global tobacco control can not make big strides," he added.