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Economic Benefits of Controlling Tobacco Use in Developing Countries

Tobacco Use in Developing Countries
Tobacco movements are familiar here in the United states, and as a direct consequence, tobacco usage has decreased almost 15 percent the past 10 years. The World Health Organization (WHO) views tobacco usage as a threat to world health that can contribute to early death, chronic diseases, poverty, environmental degradation and labor exploitation.

Socio-Economic Implications

Among these negative consequences, socio-economic implications (such as labor exploitation and poverty) is perhaps the most prominent to global well-being. A closer look reveals that over 10 percent of household income in poor countries is allocated to tobacco products.

Further, more than a quarter of people below the poverty line smoke. This disparity is characterized most often by tobacco use in developing countries. These countries often include the central Europe region. Data suggests that the global economic costs of smoking amount to nearly $2 trillion of the world’s GDP.

Behind Europe is the United States, Russia and China with staggering tobacco usage data. This includes high smoking prevalence at around 80 percent.

Preventive Measures

In 2017, The World Heart Federation published their annual report on global tobacco usage saying, “it is critical that all countries act urgently to more effectively protect their people with evidence based tobacco control policies.” Highest levels of political commitment are located in Russia.

One way the country takes measures into its own hands is to target tobacco companies directly. By combating persuasive strategies for tobacco use in developing countries, members of the public become better informed on the consequences of smoking. These consequences not only include detrimental health factors, but economic features as well.

Cutting rates in countries where smoking is an increasingly growing trend is of priority. The most competitive tobacco program is in New Zealand where smoking prevalence is below 20 percent. Further, consumption has halved in 15 years and adult usage has decreased by one quarter.

Tobacco taxation is likely to thank for the decrease in usage. New Zealand exemplifies this strategy by altering the availability of these products. Economic data implies that taxes affect prices and in turn, can be influenced by public health arguments.

Economic Implications

There are many economic burdens associated with tobacco usage. According to a study conducted by The National Library of Medicine, smoking accounts for .7 percent of China’s GDP and 1 percent of the United State’s GDP. If eliminated, many economic benefits would follow, including:

  • More accurate and diversified healthcare
  • Saving on advertising costs
  • Workplace-based investments for microeconomic stimulus

More accurate and diversified healthcare would be one of the main ramifications. Higher costs per life-being-saved versus spending for lung disease and cancer treatment would accumulate quickly into the economy. Advertising costs in 2017 accounted for over $9 billion, and the elimination of these costs could allocate economic resources more efficiently.

Future Growth Opportunities

Smaller microeconomic growth occurs when companies disperse funding into preventive programs. In the long run, these programs place consumer spending onto other products in the market.

Non-smoking movements are becoming more frequent around the world so as to curb tobacco use in developing countries. The positive consequences to controlling production and consumption surpass the economic growth associated with the tobacco industry. Inclusion and increase of positive health and well-being are associated with these preventive measures.

– Logan Moore
Photo: Flickr

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Poverty and Tobacco Use Are Linked Within a Vicious Cycle

Tobacco
Studies have shown that poor households in low-income countries can spend an upward of 10 percent of household budgets on tobacco products. Poverty and tobacco use are a highly linked global phenomenon. This disproportionate relation has several outlining side effects.

Households with less disposable income that use tobacco have fewer means of survival when it comes to health and basic living costs. The choice to buy tobacco-based products deprives families of the income needed for proper diet and nutrition. In this respect, outside of the health risks typically associated with tobacco usage, poor diet and malnutrition are within the realm of side effects.

The World Health Organization (WHO) has also reported that tobacco leads to higher illiteracy rates when money is used on tobacco products over education. One 1997 study in Chennai, India, found this to be true. “Among illiterate men, the smoking prevalence was 64 percent, whereas it was only 21 percent among those with more than 12 years of schooling,” reports the WHO.

The vicious cycle of poverty and tobacco use is prevalent throughout the world. Due to the prevalence of poverty in certain countries, farmers will accept a line of credit from tobacco companies. This credit is set in the form of seeds, fertilizer and other essentials for growing tobacco. The problem with this business transaction is that farmers must then sell all of their product. However, the profit for selling the tobacco leaves often ends up being less than that of the line of credit, leaving the farmers indebted to the tobacco companies and continuing the cycle even further.

Luckily, in 2015 the United Nations General Assembly adopted a new plan in order to combat the socioeconomic side effects of poverty and tobacco use. The Sustainable Development Goals (SDGs) formally recognize, on a global scale, the negative impact of tobacco consumption on health, wealth and development. Under the SDGs, the WHO Framework Convention on Tobacco Control (FCTC) was set to “protect present and future generations from the devastating health, social, environmental and economic consequences of tobacco consumption and exposure to tobacco smoke.”

One key difference included in the Sustainable Development Goals is that, unlike previous implementations, the SDGs apply to all U.N. members. High-income countries, especially the United States, are no exception. Though the United States has one of the highest standards of living, poverty and tobacco use still afflict lower socioeconomic groups. The Center for Disease Control and Prevention found in 2014 that, in the population of people having only a GED certificate, smoking prevalence is more than 40 percent.

Fighting poverty is essential to the fight against tobacco use. Tobacco use is a habit that is so detrimental to human life that it should be of high focus for eradication, especially when global health is at risk.

– Richard Zarrilli, Jr

Photo: Flickr