Indonesia: PMI’s $1.9billion = more cigarettes & promotions

Indonesian public health community was horrified when the President sealed a deal with Philip Morris International (PMI) to invest $1.9billion in the country. The investment includes Sampoerna factory expansion in the coming five years, 2016 to 2020. Surely a bigger operation can only mean more cigarettes – disease and death – for Indonesians. 

Indonesia remains the only country in Asia that has not banned tobacco advertising. PMI/Sampoerna which has the largest cigarette market share (34%) has been ruthless in its advertising and promotions tactics. An example of an aggressive promotion is its Sampoerna Retail Community (SRC) programme where small retailer shops in villages are renovated in the red and white colours of A Mild – its top selling cigarette in Indonesia. Painting entire shops in the colours of cigarette brands is an old tactic of the 1990s in Malaysia and outlawed when all forms of cigarette advertising was banned. This conversion of the entire shop into a permanent advertisement is a sneaky interpretation of ‘advertising at points-of-sale’ carried out to undermine regulations that ban advertising.

Sampoerna started this SRC exercise in 2010 and painted 3,000 retail outlets. Its spokesperson was clear in the objective that, “The bottom line is how passionate and how much they can push our communications.” Shopkeepers will be given training in attractive display of their products (cigarettes) and provided incentives.

These numbers of retailer makeovers will increase exponentially when other tobacco companies follow suit. Which small retailer doesn’t want his/her shop be given a make-over? According to Sampoerna, the shopkeepers are now more eager to display the cigarette brands. These paint jobs are being passed off as ‘CSR program’ to hoodwink the authorities. One can expect a louder voice from retailers on cue to oppose tobacco control and fight the Ministry of Health in its efforts to protect public health.


California date for ASEAN leaders

On 15-16 February, US President Barrack Obama will host a US-ASEAN Summit in Sunnylands, California. This Summit is described as an “unprecedented gathering” and one which “builds on the deeper partnership with the United States.”

One can assume President Obama will pressure more ASEAN countries to joining the Trans-Pacific Partnership (TPP) agreement. Currently only four (Brunei, Malaysia, Singapore and Vietnam) of the 10 ASEAN members are TPP partners. The pressure is now on the others to join or be left-out.

In October 2015, after six years of negotiations, the TPP text was finalised, and Malaysia’s proposal for a total carve-out of tobacco control measures from the agreement was compromised to a very limited ISDS-only carve-out. While this is an unprecedented step forward for tobacco control, however it does not go far enough to cover other chapters the industry can use in this agreement to fight tobacco control efforts.

The tobacco provision, crafted in legal jargon, states a country “may elect to deny the benefits of ISDS with respect to a claim challenging a tobacco control measure.” There is tremendous pressure from pro-tobacco politicians and trade groups in the US (a non FCTC party) to withdraw this ISDS carve-out.There are reports that TPP countries can now use ‘side letters’ and ‘side agreements’ to address issues which are still of concern before ratifying the agreement.

This leaves doors open for the tobacco industry, particularly PMI, AmCham, US-ABC and JTI, to lobby governments to discourage ASEAN countries who are all parties to the FCTC, from utilising the ISDS carve-out for tobacco control.

While trade may very much be in the forefront of the US-Summit, the ASEAN Economic Pillar cannot ignore the equally important Health Pillar which hosts the AFPTC (ASEAN Focal Points for Tobacco Control) which aims to reduce tobacco use in the region and save lives. Currently about 500,000 people die from tobacco related diseases in the ASEAN region.

What could the Summit hold for Indonesia, a country moving in the wrong direction for tobacco control? Less than six months ago, despite appeals from the public health community to their President not to sell out his people to tobacco, the Indonesian President agreed to a $1.9billion deal with Philip Morris International to expand its business in Indonesia. Tobacco use claims about 200,000 lives every year in Indonesia – a very big price to pay to promote this business.

Besides attending the Summit, President Jokowi will again meet with US businessmen and officials. Indonesia has expressed keen interest to join the TPP.

Meanwhile, Doctors Without Borders, an international NGO, has released an open letter to the ASEAN governments not to trade health away expressing serious concerns about the negative consequences of the TPP should it be ratified and implemented.

For information on TI denormalization, check out SEATCA’s Tobacco Industry Watch website

Previous ASEAN Tobacco Watch updates can be found here