Tobacco Company In Cambodia
Edilma Howard
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BAT Cambodia dominates cigarette market of Cambodia. The industry is possessed by a joint-venture group that comprises British American Tobacco (51%), SUTL Investments (20%), and Cambodia Tobacco Co. Ltd (29%). The other important players in the market are Imperial Tobacco and Viniton. Smaller, local manufacturers and traders in Cambodia, including Hong International Tobacco, West & East Cambodia, Broadway Synergy, Lyte Sokha, Mong Sreng Import Export Co., Rock International Tobacco, and Thai Boon Roong Group.[5]
Prakas on Legal procedure for printing of Health Warning in Khmer Language and Pictorial on Tobacco Products Packages
Sub-Decree on Printing of Health Warning in Khmer Language and Pictorial on Tobacco Products Packages
Law on Tobacco Control signed by His Majesty Norodom Sihamoni, King of the Kingdom of Cambodia on 18th May, 2015. The purpose of this law is to protect public health and reducing impacts on health, economic, social and environment caused by tobacco products
[1] -content/uploads/2020/01/Investment-Case-for-Tobacco-Control-in-Cambodia.pdf
[2] Global Data, Cigarettes in Cambodia, 2020
[3] Ibid
[4] Tobacco Production Quantity by Country, FAO Data: Food and Agriculture Organization
[5] Ibid
[6] Ibid
[7] -center-asean-tc-cambodia/
A review of more than 11,000 corporate documents, conducted over a six-month period by the International Consortium of Investigative Journalists at the Center for Public Integrity, shows that, as with corporate operations in Latin America, BAT managers and executives used a series of euphemisms in corporate correspondence to discuss smuggling operations that helped them gain a greater share of smokers and profits.
The reviewed documents, part of a cache of about 8 million pages made public as a result of the 1998 U.S. tobacco settlement, do not suggest that BAT employees themselves ever transported contraband across borders. But they sought to exploit and control to their advantage smuggling markets around the world through a network of agents who, on an annual basis, transferred billions of cigarettes into the hands of smugglers.
While other BAT companies took responsibility for sales channels into China, SUTL focused on developing new markets such as Vietnam. This plum Asian market had a population of 71 million and was viewed as a strong prospect for new business.
A series of company papers showed that, from 1991, BAT then pursued a twin-track strategy to maximize its earning from Vietnam. One track was to negotiate with the Vietnamese government and its tobacco monopoly, Vintaba, in order to produce international brand cigarettes locally.
The CNTC was founded in 1982 and brought together disparate regional producers under one umbrella organisation to enable central-planned cigarette manufacturing. It has the state-owned monopoly on tobacco growing, production and sales with an estimated 97% market share.1
The CNTC is not one organisation but manages hundreds of tobacco companies, manufacturers, suppliers, and growers of varying size. 5 This vertical spread of entities are engaged in everything from tobacco leaf production to selling the brands. Despite this their numbers are down significantly from when the CNTC was originally formed as it has looked to consolidate operations to benefit from economies of scale.6
Philip Morris International (PMI) has the biggest presence in the limited market available to overseas tobacco companies in China. It signed an agreement with the CNTC in 1994 to allow the manufacture and sale of the Marlboro brand.5 That same year PMI began sponsoring the China national football league. In 2008 PMI agreed a joint venture with China National Tobacco Important Export Group Corp. to put Chinese national brands into markets in Europe and Latin America.611
BAT has engaged in some joint-ventures and assisted with tobacco growing investment.5 These have not always proved successful.6 However the joint venture with CNTC to sell the popular BAT brand State Express 555 in China and the Shuangxi brand overseas has been in operation since 2013. The vehicle for that is CTBAT International Company based in Hong Kong.14
Japan Tobacco International (JTI) and CNTC work together to make and sell a few popular JTI brands.5 Some of those relationships are based on those JTI inherited through acquisitions of RJ Reynolds (1999) and Gallaher (2007).6 JTI established a China Division in 2003 to enable its work with the CNTC in the country.15
For countries that are parties to the WHO Framework Convention on Tobacco Control (FCTC) progress towards implementation of relevant articles, including newer products, is detailed in the FCTC implementation database.24
As with marketing, so the CNTC engages in corporate social responsibility (CSR) activities familiar to transnational tobacco firms. This is despite the fact that a parallel part of the CNTC, the STMA, is responsible for tobacco control policies.
Xu Ying, one of the State Tobacco Monopoly Administration deputy directors, gave an interview in 2020 in which he revealed that seizures of counterfeit and smuggled cigarettes had risen year on year and further action was required. He said:
CTIEC cigarettes were sold to an Iraqi company, Devmak, before being allegedly smuggled into Italy. The smugglers were found to have links to organized crime and are also suspected of being active in Moldova and Montenegro.37 36
Smuggling networks have also been uncovered in Latin America, with several China Tobacco-connected, Panama-based companies coordinating shipments of illicit products to several countries in the region. 3836
Zhang Jianmin: General Manager of the China National Tobacco Corporation, Director of the State Tobacco Monopoly Administration, member of the party leadership group of the Ministry of Industry and Information Technology. Zhang has a background in engineering before going on to gain a doctorate in economics. He served in a number of regional party posts before joining the ministry responsible for the STMA in 2018.39
Xu Ying: State Tobacco Monopoly Administration, deputy director.39 Has worked in the tobacco industry since 1992 and appears to have responsibility for countering smuggling and counterfeiting.
Han Zhanwu: State Tobacco Monopoly Administration, deputy director.39 Has held a number of personnel roles in different state organisations since 2000 before joining the Ministry of Industry and Information Technology in 2016 and the STMA in 2020.
Tobacco Tactics is produced by the Tobacco Control Research Group in the Department for Health at the University of Bath and is overseen by managing editor Dr. Raouf Alebshehy. Tobacco Tactics has a policy of strict referencing.
Disclaimer. Some of the research for Tobacco Tactics was funded by Cancer Research UK Limited and Bloomberg Philanthropies. This work has previously received funding from The New Venture Fund, Smokefree South West, and the Economic and Social Research Council (ESRC) Knowledge Exchange Opportunities scheme. These funders have had no input into the research reported on this website or its conclusions. They are not responsible for its content or publication, nor do they necessarily endorse it. Published by the University of Bath. Read the General Disclaimer.
Dr. Yel Daravuth is the tobacco control expert at the World Health Organization's office in Phnom Penh.
He says the ban is crucial to efforts to reduce illnesses linked to tobacco. Yel says illnesses such as strokes, emphysema and lung cancer are on the rise in Cambodia, and that means the time to act is now.
Dr Yel Daravuth is the tobacco control expert for the World Health Organization's office in Phnom Penh. He says developing countries that implement an advertising ban can expect to cut their smoking prevalence rate by 8 percent in a decade.
"If we are not going to prevent and have control of the tobacco epidemic, we can see these diseases in the next five years are going to be raised more," Yel said.
Yel says studies show that developing countries can expect to cut their smoking prevalence by 8 percentage points over a decade if they implement an advertising ban.
In contrast, those that do not implement a ban see only a 1 percentage point drop.
Mostly male smokers
Smoking in Cambodia is a predominantly male affair: the most recent survey released in 2006 showed that 48 percent of males over 15 light up. That compares with over 50 percent in China, Russia and some African nations. In most developed nations, the rate is under 30 percent for men.
As in most of Asia, the percentage of women using tobacco is far smaller in Cambodia. Just 4 percent of women smoke in Cambodia. Yel, however, says almost 20 percent of Cambodian women chew tobacco.
Desired effects
Five years ago Cambodia signed the Framework Convention on Tobacco Control, a global public health treaty to fight tobacco-related diseases. Under the treaty, countries promise to ban tobacco advertising, sponsorships and promotions.
Aside from the health costs that smoking brings, Yel says cutting smoking could drive down Cambodia's poverty level.
"We can find that smokers spend at least 9 percent of the income that they earn every day to buy cigarettes - a huge amount of their money," noted Yel. "[They] Can use [it] for education, support the child to study, the family, the food - it's very important."
Tobacco company response
British American Tobacco, or BAT, is one of the biggest tobacco companies in the world, and dominates Cambodia's market with a 35 percent share.
BAT says it backs advertising restrictions and that the new law broadly matches BAT's own policies. The company says it does not market to youth or use celebrities in ads, for instance. The company also does not sponsor events unless those taking part and watching are adults.
But BAT's restrictions are not followed by all players in the Cambodian market.
Targeting youth
Dr. Mom Kong heads the Cambodian Movement for Health, which wants restrictions on tobacco and alcohol use.
He says some tobacco companies openly market to young people - something the new law will prevent.
Dr Mom Kong heads the Cambodian Movement for Health, an NGO that advocates for curbs on tobacco and alcohol advertising. The new law, he says, will prevent tobacco companies from targeting their products at young people.