The tobacco value chain is facing disaster due to illicit trade.
The illicit trade in tobacco products is placing the future of farmworkers in the labour-intensive tobacco industry in jeopardy, along with the livelihoods of commercial and developing farmers, according to Francois van der Merwe, chairperson of the Tobacco Institute of Southern Africa.
Speaking at a farmers’ day in Vaalwater, Limpopo, recently, Van der Merwe said the industry currently employed between 8,000 and 10,000 workers, who had about 35,000 dependents between them.
Joe Heshu, head of external affairs at British American Tobacco (BAT) South Africa, added that this illicit trade had a detrimental knock-on effect on the entire tobacco value chain, which manufactured South Africa’s top six cigarette brands.
In the past, the bulk of illegal tobacco products was smuggled into the country from outside the country’s borders.
“[However,] more recently, the problem has been tobacco products that are manufactured within South Africa, but are not declared to tax authorities, and manufacturers consequently do not pay the high excise duties on their products that the legitimate industry does,” he explained.
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