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The Fate of the World Tobacco Business is Decided in Russia

The Fate of the World Tobacco Business is Decided in Russia

Arguments and Facts

The leading Russian weekly Federal newspaper circulation 3 million


Start war on tobacco!

The Fate of the World Tobacco Business is Decided in Russia

Author: Aleksandr Melnikov

Published: 2011-06-08 00:05:00

While the whole world actively straggles against smoking, tobacco industry flourishes in Russia. Why they are successful in our country and increase business?

About shadow side of this business we are told by Andrey Demin, MD, Doctor of Political sciences, Professor of I.M. Sechenov First Moscow State Medical University. He has spent years studuing tobacco industry and prepared book «Russia: Business tobacco. Investigation of mass killing».

Feeling hurt for the countr

— I wanted in the title to use the word “war”, but it did not fit. There is no war, there is mass killing. Every year due to diseases caused by smoking in our country population of a big city perishes — about 400 thousand humans. And the country nearly does not resist this. There are already State Duma deputies – servants of tobacco industry.

Political, economic system merged with interests of foreign tobacco industry. They are «respected investors», they are welcomed with embraces. So it was recently in Kaluzhskaya Oblast where Korean company, investing $100 million, started production of cigarettes for women. Why we need such socially dangerous investments, we already have nearly half of pregnant women smoking, and often fail to save lives of infants hurt by this?

The most comfortable «nests» tobacco companies built in three regions — more than half of all tobacco investments came to Saint Petersburg and Leningradskaya Oblast, and 22% — to Moscow. Budget of Leningradskaya Oblast is dependent on tobacco industry, Petersburg is also on that needle. It is not profitable for the authorities to limit producers of cigarettes, plus there are close links between tobacco industry and local elite. In Russia tobacco is not grown, and practically all import of raw materials comes through one customs terminal in Leningradskaya Oblast. In 2004 at the border there was suspended sanitary-epidemiological surveillance of tobacco raw materials and addition materials for cigarette production, among which there are many unknown chemicals. From the start of 1990s tobacco industry receives credits and preferences on imports of equipment. In 2009 this equipment is again officially included in the list of technological equipment, «import of which at the territory of Russian Federation is not subject to taxation by value added tax».

Tobacco industry may influence customs service. I’ve got minutes of meeting of Public-consultative council on customs policy under federal Customs Service, held in 2007. There is protocol of speech of head of Moscow International business association А.I. Borisov who is talking about the terminal already familiar to us: «From 1 January is changing customs clearance of goods of group 2401 „tobacco“ through Central excise customs. 95% of all import of tobacco comes through Saint Petersburg, and in this relation there emerges rather big problem: how to make so, that not to make damage to this great mass (tobacco raw materials and tobacco waste, these are also used in cigarettes. — „AiF“)? In August the leadership of Central excise customs met representatives of companies and promised to consider opening of department of of clearance and customs control in the port. But, if I was rightly informed, now the leadership changed, and there arouses a number of fears, that what was conceived would not be possible to implement, and companies are ready to help with solution of this question».

There is even tobacco pressure on behalf of Russia at the international level. In EvrAzES (Euroasian Economic Communiity) they were actively preparing introduction of warning pictures on harm of smoking on cigarettes. And after signing of Customs Union this work was stopped. However in Kazakh Republic legislators were planning to introduce this useful requirement in the State Codex “On People Health and Health Care System”. At the request of tobacco industry which is 93% foreign companies, in this process interfered Deputy minister of economic development of Russian Federation А. Likhachev, who sent in February this year a letter to the Minister of economic development and trade of Kazakhstan asking to “provide explanations on this issue», because now this unilateral decision would be illegal within the Customs Union frame».

Do not save money

Representatives and allies of tobacco industry penetrated in all sheres — state management, business, civil society, mass media, education. All remember, how on of companies sponsored Moscow police, participating in social programs. Indirectly or directly tobacco industry is participating in Consultative council on foreign investments in Russia, Trade-Industrial Chamber, Advertising Council of Russia, Guild of Kremlin suppliers and other influential organizations. In the world they were expelled from all similar places and sponsorship programs, they are absolute pariahs there. And until we do not ban this, as required by the Framework Convention on Tobacco Control, which is ratified by Russia, tobacco industry will continue to successfully pursue its interests. They do not save money on this.

According to estimates, budget of department of one large tobacco company in Russia, in which 30 full time experts promoting interests of the company in the governmental structures are employed, is 80 million Russian roubles (about $3 million) per year. This is comparable to budgets of similar GR departments of “Rosneft”, “Gazprom”, Russian Rail Roads.

Producers of cigarettes created in Russia a base of global scale and because of this influence tobacco control policies in the whole world. In Russia there is concentrated enormous tobacco production, which is estimated in cost at $13 billion per year. It is naïve to believe that considerable part of this funds remains in Russia.

According to available data, only four leading global tobacco companies , based in only three countries — USA, UK and Japan, — receive mammoth $21,6 billion per year from sales of tobacco in other countries. Please note that these incomes very much exceed their incomes at homes. Great incomes they receive from former USSR republics, but the most from Russia.

According to our estimates this is about $10 billion per year. Such financial flow show, which essential role Russia plays in support of global “tobacco epidemic”. Our country must stop treating this socially dangerous industry as normal and introduce state monopoly under control of health care, to protect itself and others.

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Translated from Russian by Andrey Demin 

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