Smoking Trends Defy Global Decline: China’s Tobacco Giant Leads the Way
While the world witnesses a steady decline in cigarette sales, China is bucking the trend. The China National Tobacco Corporation, a state-owned company, has a near-monopoly on the country’s tobacco product sales, making it the largest cigarette producer in the world.
A Growing Market
Retail cigarette sales in China have been growing for the past four years, reaching 2.44 trillion sticks in 2023. This upward trend is expected to continue, with sales forecasted to hit 2.48 trillion by 2028. The increasing popularity of “slim” cigarettes and flavored cigarettes has contributed to this growth.
A Dominant Player
China Tobacco, as the company is commonly known, accounts for 97% of the country’s tobacco production and sales. Its revenue reached 1.5 trillion yuan ($210 billion) in fiscal year 2023, up 4.3% from the previous year. In comparison, Philip Morris International, the world’s second-largest tobacco company, reported a net revenue of $35.2 billion in 2023.
Government Influence
The State Tobacco Monopoly Administration, which oversees China Tobacco’s operations, is directly involved in setting tobacco control policy in the country. This creates a conflict of interest, as the company functions as both a business and a regulatory agency. Industry experts argue that this close relationship between the government and China Tobacco has hindered the adoption of stricter tobacco control policies.
Global Expansion
China Tobacco’s monopoly status has driven its strong growth in China, but the company is now expanding globally. Under Beijing’s “One Belt, One Road” initiative, China Tobacco has established operations in 20 countries, with 34 offshore facilities. The company’s subsidiary, China Tobacco International (HK), has seen its stock rise over 376% since its IPO on the Hong Kong Stock Exchange in 2019.
A Cause for Concern
The expansion of China Tobacco raises concerns about the impact on global tobacco use. Experts warn that the company’s growth could lead to increased smoking rates and negative health consequences. As the world’s largest tobacco producer, China Tobacco’s actions have significant implications for global public health.
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