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Who benefits from a report into cigarette smuggling in the Maghreb?

Phillip Morris' Malboro cigarettes on sale at a duty free store [file photo]
Phillip Morris' Malboro cigarettes on sale at a duty free store [file photo]

The Royal United Services Institute (RUSI) is one of the finest think tanks in the world. Its experts offer sober advice on foreign and defence policy far outstripping that of other, more politically motivated, organisations operating in and around Westminster.

It is disappointing, therefore, to see that RUSI is being paid by big tobacco firms to shore up business interests in the Maghreb, and being far from transparent about it in the process. “Over twenty per cent of cigarettes consumed in the Maghreb are illicit,” claimed a KPMG report published last month, to which RUSI contributed its own analysis and research.

While it may have been KPMG’s logo on the front of the report, a closer reading shows that the firm had actually been hired by Philip Morris International Management SA, the tobacco company behind Marlboro, Chesterfield and L&M.

Phillip Morris has an interesting track record in Muslim countries when it comes to smoking. In 1985, it circulated an internal report stating that the World Health Organisation “has not only joined forces with Moslem [sic] fundamentalists who view smoking as evil, but has gone yet further by encouraging religious leaders previously not active anti-smokers to take up the cause.” It went further: “With Islam we might ask what other aspects of modern living are similarly open to extremist demands for prohibition under strict interpretation of sharia: motion pictures, television, and art depicting the human being? Use of electronic amplification by muezzin calling from a minaret? The education of women?”

The recommendation suggested that PMI marketing staff should paint any prominent Muslim who attacked smoking as “a ‘fundamentalist’ who wishes to return to sharia law,” and even attempted to recruit Western Muslim scholars to encourage smokers.

The KPMG/RUSI report noted with particular alarm that one in five cigarettes across the Maghreb region (basically north-west Africa) is illicit. Some $565 million in lost tax revenue was the result, it pointed out, money that could be going to shore up struggling central governments.

Morocco remains world’s largest cannabis producer

Two hydroponic cannabis plants [Plantlady223/Wikipedia]

Two hydroponic cannabis plants [Plantlady223/Wikipedia]

The reason that the study had been commissioned had nothing to do with shedding tears over tax revenue, of course. The latest PMI annual report bemoans the fact that “consumption of tax-paid cigarettes continues to decline in many of our markets.” It cited the “continuing prevalence of illicit products.” The same report had repeatedly condemned excise rises in multiple markets around the world, while PMI has a habit of suing countries which don’t bow to its lobbying pressure.

A clue as to why this tobacco firm really commissioned KPMG, which in turn commissioned RUSI, is found in the latest sales figures for its North Africa unit, which overall saw a 3.4 per cent drop in cigarette shipments in 2015. Particularly big drops in Algeria and Tunisia were behind this, both of which were in scope for the RUSI-KPMG collaboration.

Their analysis identified that nearly one in four cigarettes smoked in Tunisia is either counterfeit or contraband, the highest in their joint study. Meanwhile, Algeria had the lowest number of illicit cigarettes being smoked, but was also facing an overall fall in cigarette consumption of eight per cent – which is bad news for Philip Morris International – and had the largest outflows of cigarettes in the region to boot.

Libya was found to have the highest illicit cigarette consumption overall. Interestingly, the report noted that the bulk of illegal cigarette imports originated in the United Arab Emirates’ free zones, amounting to fifty seven per cent of total imports. These are generally introduced in Libya, before being distributed to neighbouring countries.

RUSI declares its own funding on its website, ranking the governments, military units and arms companies that fund the analysis produced by its experts. Phillip Morris International is listed as giving between £50,000 and £99,999, along with British American Tobacco.

#Drugs

The think tank’s media work promoting what it does for the tobacco lobby is less transparent though. A recent investigation into illicit cigarettes in the European Union was advertised on the RUSI website, YouTube channel and a BBC broadcast as “a new report by RUSI commissioned by KPMG.” In fact, PMI had also paid KPMG for the study, as had British American Tobacco. KPMG had in turn paid RUSI. Thus, RUSI was working for big tobacco; it just wasn’t advertising the fact.

The same happened with the Maghreb report. A press release issued to journalists was headed “RUSI Contributes to New Study on Illicit Cigarette Trade in Maghreb” and said that the think tank had been “commissioned by KPMG”. It was surely pertinent to mention that KPMG was itself working for a tobacco company.

RUSI has some fine analysts working on a range of complex problems around the world, but its dealings with big tobacco companies in the Islamic world are suspect. If it is going to take money for a particular report, it should say clearly who the ultimate beneficiary is; such transparency should include its pre- and post-publication media releases.

And all of this comes before we get to the most important point of all; smoking is very, very bad for you. So much so, that big business has to pull out all the stops to get more people addicted. Profits come before health, and reputable organisations are being tainted in the process.

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