China tobacco profits undermine anti-smoking push

January 6, 2011 By GILLIAN WONG , Associated Press
A man smokes while resting on a chair near the Tiananmen Square in Beijing Wednesday, Jan. 5, 2011. China's government has failed to curb smoking in a country with the world's largest number of smokers because it is too comfortable with revenues from the tobacco monopoly it owns, a group of prominent public health experts and economists said Thursday. (AP Photo/Alexander F. Yuan)

(AP) -- China's addiction to huge revenues from its state-owned tobacco monopoly is hindering anti-smoking measures, potentially costing millions of lives in the country with the world's largest number of smokers, experts warned Thursday.

The health and other costs of smoking already exceed the tobacco industry's economic contributions by at least $9 billion, said a report prepared by a group of prominent Chinese public health experts and economists.

If trends continue, by 2030 an estimated 3.5 million Chinese will die from smoking each year - three times the current level, it said, citing China's failure to take basic measures such as passing a national law to ban smoking in indoor public places and raising the price of cigarettes.

The analysis underscores increasing concerns that the government is jeopardizing the country's economic potential by refusing to take serious action to combat a widespread problem that escalates medical costs and hurts productivity.

Political will is lacking because China's leaders often consider only the short-term benefits, according to Teh-wei Hu, a health economics professor at the University of California, Berkeley, who has advised the government to raise cigarette prices.

"When I talk to leaders in high-level positions, they say, 'Well, I know and people know that smoking is harmful, but I won't be popular if I raise the prices," Hu said.

The report, titled "Tobacco Control and China's Future," pointed to a in the system. China's State Tobacco Monopoly Administration, which sets tobacco policy and enforces rules, is the same federal agency that controls the China National Tobacco Corp. - the world's largest cigarette maker. The report criticized the administration for promoting tobacco production and sales and hampering efforts to strengthen tobacco control.

"This is the first 'critical' report of China's efforts on from within China itself," said Judith Mackay, a World Lung Foundation senior policy adviser who reviewed the report and wrote a preface. "This speaks volumes of the strengthening of the health groups in China in countering the powerful Chinese national tobacco monopoly."

Curbing tobacco use, which is linked to the deaths of at least 1 million people in China every year, is one of the greatest health challenges the country faces. Nearly 30 percent of adults in China smoke, making up about 300 million people - a number roughly equal to the entire U.S. population. The report said that while China's overall smoking rate has not seen any significant change over the last decade, tobacco-linked deaths have risen rapidly.

"While the (tobacco) industry remains a 'major taxpayer' today, it causes enormous social costs and overall poses a loss rather than a benefit to China," the report said.

The State Tobacco Monopoly Administration could not immediately be reached for comment. The tobacco industry's position has usually been that measures to curb smoking would reduce revenue to the government and put tobacco farmers out of work.

The report was timed for release days ahead of a Sunday deadline that China will fail to meet - to ban smoking at public indoor venues under a global anti-tobacco treaty backed by the World Health Organization.

Smoking is so entrenched in Chinese society that cigarette cartons are commonly exchanged as gifts. A study shows almost half of all male doctors smoke, and tobacco companies are even allowed to sponsor schools. In many parts of China, people will light up in hospitals, offices and even elevators.

However, last year, authorities did instruct kindergartens and elementary, secondary and vocational schools to ban smoking on school grounds and bar teachers from lighting up in front of students.

Nearly 60 experts were involved in writing or reviewing Thursday's report, including its chief authors, Dr. Yang Gonghuan, deputy director of the official Chinese Center for Disease Control and Prevention, and Professor Hu Angang of Tsinghua University, one of China's best-known economists and a key policy adviser.

The report attempts to quantify the cost to China from smoking. Last year, it cost 61.8 billion yuan ($9.3 billion) more to treat people for smoking-related illnesses than the industry generated in profits and jobs created, the report said. Official data released last month said the made 65.9 billion yuan ($9.9 billion) in profits in the first 11 months of last year, 6.3 percent higher than the same period last year.

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