The tobacco industry and the impacts of its products is costing the world more than US$1 trillion annually in healthcare expenses and lost productivity, according to a new landmark global report from the World Health Organization (WHO) and the US National Cancer Institute (NCI).
“The economic impact of tobacco on countries, and the general public, is huge, as this new report shows,” says Dr Oleg Chestnov, WHO’s Assistant Director-General for Noncommunicable Diseases (NCDs) and mental health.
“The tobacco industry produces and markets products that kill millions of people prematurely, rob households of finances that could have been used for food and education, and impose immense healthcare costs on families, communities and countries.”
According to the report, there are 1.1 billion smokers aged 15 or older in the world, with around 80% living in low- and middle-income countries and 226 million smokers living in poverty.
Smoking causes 6 million deaths every year currently and it is set to increase to 8 million annually by 2030, said the report, which was peer-reviewed by more than 70 scientific experts.
Health experts say tobacco use is the single biggest preventable cause of death globally.
The cost of the tobacco industry also far outweighs global revenues from tobacco taxes, which the WHO estimated at about US$269 billion in 2013-2014.
The economic costs are expected to continue to rise, and although governments have the tools to reduce tobacco use and associated deaths, most have fallen far short of using those tools effectively, said the report.
According to WHO, tobacco control policies, which include tobacco tax and price increases, can generate significant government revenues for health and development work.
Citing a 2016 study, the report said that annual excise revenues from cigarettes globally could increase by 47%, or US$ 140 billion, if all countries raised excise taxes by about US$0.80 per pack. Additionally, this tax increase would raise cigarette retail prices on average by 42%, leading to a 9% decline in smoking rates and up to 66 million fewer adult smokers.
Other cheap and effective tobacco policies include comprehensive smoke-free policies, complete bans on tobacco company marketing, and prominent pictorial warning labels.
In 2013-2014, governments around the world spent less than US$1 billion on tobacco control, according to a WHO estimate.
Tobacco regulation meanwhile is reaching a crunch point because of a trade dispute brought by Cuba, Indonesia, Honduras and Dominican Republic against Australia’s stringent “plain packaging” laws, which enforce standardized designs on tobacco products and ban distinctive logos and colorful branding.
The World Trade Organization is expected to rule on the complaint this year. Australia’s policy is being closely watched by other countries that are considering similar policies, including Norway, Slovenia, Canada, Singapore, Belgium and South Africa, the study said.