* Legal support offered to help fight industry
* Countries follow NYC example, tobacco profits hurting
* May face opposition in China, world's biggest consumer
By Sharon Begley
NEW YORK, March 22 Michael Bloomberg's
charitable foundation will commit $220 million over the next
four years to fight tobacco use globally, including for the
funding of legal challenges against the industry.
Calling tobacco "a scourge all over the world" and accusing
cigarette makers of "nefarious activities", the New York City
mayor told a news conference his foundation would focus on
low-and moderate-income countries where nearly 80 percent of
smokers live, like Russia, China, India, Indonesia and
Bloomberg was set to announce the new funding for Bloomberg
Philanthropies on Thursday at the 15th World Conference on
Tobacco or Health in Singapore. The commitment takes the
foundation's total pledge to the cause to almost $600 million.
Smoking could kill about 1 billion people this century,
authors of the fourth edition of the Tobacco Atlas said at the
book's launch in Singapore on Wednesday. The book is published
by the American Cancer Society and World Lung Foundation.
Bloomberg's initiative is likely to face opposition in
China, the world's largest producer and consumer of tobacco with
more than 300 million smokers, from a powerful state monopoly
and officials who fear a fall in tobacco profits.
The tobacco industry provides nearly one-tenth of tax
revenues in China. According to the State Tobacco Monopoly
Administration, the tobacco tax take in 2011 rose 22.5 per cent
to 753 billion yuan ($119.09 billion). The state tobacco
monopoly produced profits of 118 billion yuan in 2010.
For years, China has held half-hearted campaigns to stub out
the habit. Last year, it said it would ban smoking at indoor
public venues, but non-smoking signs are routinely ignored.
Although nearly 1.2 million Chinese people die from
smoking-related diseases each year, the habit is considered an
important part of socialising and Chinese cigarettes are among
the cheapest in the world at less than a dollar a pack.
"As more and more people are prematurely affected by
disease, disability and early death due to tobacco, social
services such as medical care may be overwhelmed," Michael
O'Leary, the World Health Organisation's China representative,
said in emailed comments to Reuters.
Tobacco use cost China $28.9 billion in direct medical costs
in 2008, more than four times the amount in 2000, the Tobacco
NEW YORK'S EXAMPLE
The initiative is a departure from Bloomberg's efforts since
2007, which have focused on "what's worked here" in New York,
said Dr. Kelly Henning, director of the charity's public health
That included pressing local and national governments to
raise cigarette taxes, persuading the entertainment industry not
to film movie stars smoking, making nicotine patches widely
available and lobbying for laws that ban tobacco advertising,
sponsorship and smoking in public.
The New York City example is gaining traction overseas. This
month, India increased its cigarette tax.
"We've been doing tax advocacy in India for the last year
and have now seen 12 states raise their state-level value-added
tax on cigarettes," said Henning. "This increase is at the
national level. We consider it a small step forward."
India banned smoking in public places in 2008, and since
last year all smoking scenes in films must be accompanied by an
on-screen health warning.
According to an Indian government report, tobacco-related
illnesses cost India $6.1 billion in 1999. The government earns
about $1.4 billion in excise revenue from tobacco.
As anti-tobacco policies and laws are extended globally -
they cover 2.2 billion people - they threaten cigarette makers'
profits and the industry is fighting back.
A case in point is Indonesia, where about 68 million people
smoke and regulation is weak, said Tulus Abadi, a member of
Indonesia's National Commission on Tobacco Control.
Cigarette firms can advertise freely in the media and a
regulation initiated three years ago to create smoke-free zones
and new cigarette packaging has not been passed because of
objections from the industry, Abadi said.
"Every time you want to make a regulation, it is very
difficult because on every level of the bureaucracy they have
been bought by the cigarette industry," he said.
In Indonesia, most smokers are poor and a family's spending
on cigarettes comes second after spending on rice, the main
staple, according to data from the Statistics Bureau.
To counter a decline in smoking in the United States,
cigarette makers have relied on higher prices, cost cuts and
growth in smokeless tobacco to keep profits rising.
They have also targeted overseas markets, especially China,
Indonesia, and Russia, where a growing middle class can pay for
The Tobacco Atlas says the industry reaped profits of $35
billion in 2010.
Bloomberg Philanthropies helps countries such as Uruguay
take on tobacco firms.
The South American country adopted a law in 2009 that
required warning labels to cover 80 percent of the surface of
cigarette packs - the most in the world - and that each brand
have only one variant, among other restrictions.
In response, Philip Morris International and three
affiliates filed a complaint with the International Center for
Settlement of Investment Disputes, part of the World Bank,
alleging that the restrictions harmed business operations and
violated a bilateral investment treaty between Uruguay and
Switzerland, where two affiliates are based.
Bloomberg is underwriting legal assistance for Uruguay, said
Henning. "If industry wins this one, other countries will be
terrified of adopting anti-tobacco measures," she said.