Photo: Jason Alden / Bloomberg
Photo: Jason Alden / Bloomberg
Photo: Jason Alden / Bloomberg
The pandemic has caused a problem, Japan Tobacco International Inc. warns: more illicit trade in cigarettes.
Organised crime networks have established illegal warehouses and factories in European countries such as Greece, Ireland and Belgium to approach target markets such as the UK, Japan Tobacco executives said in a presentation at the Global Tobacco and Nicotine Forum this week. Discretionary revenue source can drive demand for less expensive cigarettes, according to cigarette manufacturer Winston and LD.
“This is a direct result of the pandemic,” said Ian Monteith, Japan Tobacco’s Director of International Tobacco Trade. “The criminals will try to exploit it. “
The global illicit tobacco market is between $40 billion and $50 billion a year, according to a World Bank report released last year. The counterfeiting and smuggling industry, if it were a business, would be the fourth largest cigarette manufacturer, generating $600 billion a year.
Previous border blockades and closures earlier this year disrupted the black tobacco market, making it difficult to ship counterfeit cigarettes from places where container transport is manufactured, such as Belarus, which has led smugglers to regroup, according to Japan Tobacco.
Counterfeit cigarettes can disclose to consumers the dangers of physical fitness because they have undergone quality control. About one in 10 cigarettes are purchased illegally and the product is channeled into organized crime and terrorism, depriving governments of tax revenue, Japan Tobacco said.
However, the number of production and garage sites dismantled by police in Europe fell to 64 in the first part of the year from 113 the previous year, according to Europol. Closures have reduced the investigative capacity of law enforcement, Simone Pierre Di Meo said. , expert at the Europol European Centre for Finance and Crime in The Hague.
Higher taxes in Russia can only boost demand for smuggled cigarettes, Japan Tobacco said. The country’s Ministry of Finance proposed last week to increase excise duties on cigarettes, tobacco products and e-cigarettes by 20% next year.
The tobacco industry cites Malaysia as an example of how higher tobacco taxes can reduce government revenues. pay, Japan Tobacco said.
Di Meo of Europol said the organization had obtained data from member states that organized criminal teams were storing illicit products in several countries in anticipation of huge increases in excise taxes.
Critics of large tobacco companies have said that the industry is rarely complicit in the illicit industry of its own products. The Global Centre for Good Governance in Tobacco Control said in April that smuggling reports had been used to justify easing periods of blocking sales restrictions.
Japan Tobacco said that 96% of all reported seizures of its products concerned counterfeit cigarettes and its chain of origin was well secured and maintained. The company sells Winston and Camel cigarettes outside the United States.
Michael R. Bloomberg, founder and majority owner of Bloomberg News, the parent company of Bloomberg News, campaigned and donated cash to the US ban on e-cigarettes and flavored tobacco.