Zimbabwe’s money spinning tobacco sector, one of the main sources of liquidity in the country, could suffer a huge blow with seasonal deliveries seen declining by 50% if the ongoing global anti-tobacco conference in India endorses the mandatory reduction of nicotine levels in cigarettes, it has emerged.
By Fidelity Mhlanga
The conference, from November 8-12, seeks to reduce nicotine down to a maximum of 0,4 miligrammes, which is 10% of current levels.
Delegates are intent on reviewing the implementation of the World Health Organisation Framework Convention on Tobacco Control (WHO FCTC) and the Protocol to Eliminate Illicit Trade in Tobacco Products. The meeting comes amid a global lobby against smoking in public places due to rising cases of cancer.
Statistics from Treasury show tobacco exports were only second to gold, valued at US$481 million and constituting 23% of all exports from January to October 2015. Gold exports were valued at US$503 million, indicating the importance of the golden leaf to Zimbabwe’s economic survival.
As at September 2 this year, tobacco weighing 201 million kilogrammes and valued at US$592,5 million was sold, at the average price of US$2,94 per kg.
Office of the President and Cabinet deputy chief secretary Christian Katsande, executive secretary of the National Economic Consultative Forum Norman Chakanetsa and officials from the ministries of Health and Industry and Commerce are currently attending the global conference in India.
Tobacco Industry Marketing Board Chief executive officer Andrew Matibiri said the endorsement of the reduction of nicotine in tobacco would affect tobacco deliveries that have been on an upward trend in recent years.
“Anything that amounts to the reduction of nicotine in tobacco means we will not be able to produce tobacco in the same level,” he said.
Matibiri said tobacco producers could, however, lobby for the use of genetic modification to neutralise nicotine levels in tobacco despite global resistance to the method.
Conference of the Parties (COP7) to WHO FCTC are lobbying for total exclusion, or market access exclusion or differential treatment (punitive taxes, duties, etc) of tobacco and its products on the world trade platform.
Experts say should the regulation sail through, demand for tobacco will decline drastically, by up to 50%, as low-value tobacco will be required by cigarette manufacturers.
Zimbabwe Tobacco Association chief executive Rodney Ambrose said if the regulation is endorsed this will result in tobacco being untradeable on world markets and would make tobacco growing valueless and affect Zimbabwe which exports over 95% of its tobacco.
“We will see tobacco production in Zimbabwe drop by at least 50% along with US dollar earnings, growers’ livelihoods and dependents along with all downstream industries that support two million people will all be at risk,” he said.
“This will negatively impact on yields and growers’ returns, resulting in poor viability of tobacco farmers, forcing millions of Zimbabwe farmers out of tobacco production.”
Only government officials are allowed to attend the global convention. The WHO FCTC refuses to entertain any dialogue with the tobacco industry.
“I am sure you appreciate from the above the devastating impact such regulations could have on our industry if the WHO FCTC is not stopped from making unreasonable, non-consultative proposals. The WHO FCTC should concentrate on health issues, not trade, as there are arms of the UN that regulate trade, ie WTO, who have shown no objection to the trading of tobacco,” Ambrose said.