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New research reveals underhand activities by tobacco companies rife in Former Soviet Union

May 27, 2004

British American Tobacco engaged in underhand practices including smuggling, and exploited the weak political and economic situation in the former Soviet Union to establish cigarette imports and local manufacturing, new research reveals today.

The revelations, which are published today in a series of papers(i, ii, iii) in the journal Tobacco Control (http://tc.bmjjournals.com/), came to light as a result of a review of data on industry investments and their impact on cigarette production capacity, as well as a meticulous trawl by authors Anna Gilmore and Martin McKee of the London School of Hygiene & Tropical Medicine (LSHTM) through hundreds of documents housed within British American Tobacco (BAT)'s secretive depository in Guildford, UK.

The authors are calling for a renewed effort to build capacity in transition economies so that governments are better able to respond when companies use business practices that fall short of international standards. 'Countries targeted by the tobacco industry need to be aware of its tactics and develop effective tobacco control policies to ensure that vulnerable populations can no longer be targeted in the ways detailed in these papers', says Dr Anna Gilmore, a Clinical Lecturer in Public Health and lead author on the papers.

The countries of the former Soviet Union (FSU) have been a key focus for tobacco industry investments over the last decade. Between 1992, when the first tobacco investments occurred and the end of 2000, transnational tobacco companies (TTCs) invested at least US$2.7 billion in 10 countries in the region. These papers detail how they took advantage of a number of key factors to establish imports: a chaotic tobacco industry, which under the Soviet system had been state owned; chronic cigarette shortages; a desire among the population for western goods which were seen as sophisticated and desirable; and the naivety of the post-Soviet governments as to the underhand conduct of powerful transnationals.

'These documents provide key insights into the thinking behind the transnational tobacco companies' focus on the former Soviet Union market, and highlight the elaborate and devious tactics used to establish imports. The Guildford papers specifically r eveal how BAT exploited chaotic situation in the immediate post-transition period to ensure illegal cigarette imports, and how they targeted a susceptible population which was hungry for western products by equating smoking with western "sophistication"', says Dr Anna Gilmore.

BAT is revealed to have used flawed economic arguments to persuade inexperienced and na'-ve governments that allowing them to invest would reap economic benefits. Company representatives offered misleading excise advice that actually disadvantaged governments while benefiting BAT. BAT was able to operate in this manner because international financial organisations such as the International Monetary Fund took the view that rapid economic reform should be actively championed, regardless of the nature of the investing company or the product it sold.

The Guildford papers also reveal how BAT identified women as an important new market. Smoking among women had been rare in the FSU, yet BAT noted that women, in common with other young smokers, were more likely to smoke international filter brands rather than locally produced cigarettes. BAT specifically targeted women in its marketing and female smoking rates are now rising. Men in the FSU already have the highest rates of premature mortality in Europe and if female smoking continues to increase, female death rates from tobacco will certainly rise.

As notable as the industry's focus on the economic impacts of tobacco was the total absence of any debate about tobacco's health impacts', say the authors. 'Thus, as far as we can tell, the governments of the newly independent states received little if any effective tobacco control advice or appropriate information on the true health and economic impacts of tobacco'.

'BAT is spending heavily on image rehabilitation in an attempt to convince us that things are different now, but all the evidence suggests the company is still operating in the way it always has and is now turning its attentions towards developing markets elsewhere. The global public health burden from tobacco is set to double between 2000 and 2030 from 4.9 to 10 million deaths, with the most rapid increases predicted in developing countries. Such countries need to be vary wary of the predations of BAT and its competitors', concludes Anna Gilmore.

To interview the authors, please contact Melanie Batty on 0207 927 2944.

London School of Hygiene & Tropical Medicine (LSHTM)