Uganda: Time to Increase Tobacco Prices

Source from:  The Monitor (Kampala) 26 May 2007 05/29/2007

Kevin O'Connor Last week, Vice President Gilbert Bukenya drew attention to the many disadvantages to Ugandan farmers of cultivating tobacco. Bukenya's comments could not have been more timely as next Thursday (May 31) is the World Health Organisation's (WHO) World No Tobacco Day. Tabu Butugira (The Daily Monitor, 22 May 2007) reported that Bukenya told the people of West Nile that tobacco growing should be abandoned in favour of other cash crops, as it had made the people poorer. "I don't want you people to do something that makes you work at a loss," he said while addressing residents of Aringili village in Koboko district. While Bukenya focussed on the production disadvantages of tobacco, the consumption disadvantages are even more striking. Tobacco is the number one preventable cause of death in the world. Tobacco smoke contains more than 4,000 chemicals, at least 50 of which cause cancer. Tobacco kills almost five million people worldwide each year. If current trends continue, it is projected to kill 10 million people a year by 2020, with 70 percent of those deaths occurring in developing countries like Uganda. Tobacco also takes an enormous toll on health care costs, lost productivity, not to mention the pain and suffering inflicted upon smokers, passive smokers and their families. And, it is more painful to die of cancer in Uganda, as most hospitals and clinics do not have the sophisticated pain-relieving drugs that are readily available in developed countries. The good news is that the Ugandan Cabinet has supported WHO's Framework Convention on Tobacco Control (FCTC), and the country's formal ratification will have taken place by the end of this month. The FCTC is the world's first global public health treaty. It aims to protect present and future generations from the devastating health, social, environmental and economic consequences of tobacco through comprehensive tobacco advertising bans, price and tax increases, big graphic health warning labels on tobacco products, measures to protect people from second hand smoke and alternative crops for tobacco farmers. Regular and substantial increases in excise duty on tobacco products are arguably the most important single weapon envisaged by the treaty. The result will be both increased government revenue and reduced Ugandan mortality. This "win-win" situation linked to the demand for cigarettes being inelastic i.e. if their price increases by a certain percentage, the quantity demanded will decrease by a smaller percentage due to the addictive nicotine component in tobacco. World Bank funded research in South Africa shows that increasing tobacco taxes by 50 percent, increases their price by 10 percent and reduces consumption by 8 percent. Thus there can be wonderful common ground between the Ministry of Finance and the Ministry of Health. The fact that Kenya and Tanzania have also ratified the FCTC means that it will be straightforward to harmonise such a tobacco tax policy throughout the East African Community. The tobacco industry is a formidable public health enemy, and it should never be underestimated as an opponent. But the prospects for the Ugandan David overpowering the Multinational Tobacco Goliath have never been better. Enditem