[Intl-tobacco] Foreign tobacco cos. eye China following WTO opening

[Robert Weissman]

China Has 350 Million Smokers; Foreign=A0=A0Tobacco Firms Eager To Butt In
Source: China Online, Saturday, 10/7/00

(6 October 2000) Tobacco companies worldwide are most likely holding their
breath in anticipation of China=92s entry into the World Trade Organization=
=2E

When China joins the WTO, the world=92s last massive tobacco market will be
opened to international tobacco makers, according to a recent report by
U.S.-based Morgan Stanley Dean Witter Co. investment bank.

With 350 million smokers, China is the world=92s largest tobacco market, th=
e
report said. Chinese smokers outnumber the entire U.S. population,
according to the Sept. 20 Zhongguo Huanjing Bao (China Environment News).

Based on a survey of private and state-owned enterprises in China, Morgan
Stanley concluded that free trade and domestic demand for high-end tobacco
products will force open Chinese tobacco markets to foreign products. The
surveyed companies produce 45 percent of the global market share.

Morgan Stanley predicts that China will forfeit the domestic monopoly of
its tobacco market when it joins the WTO, an invitation for transnational
tobacco companies to enter the world=92s last major untapped market.

Asia consumes half of the world=92s tobacco. However, cigarette sales
revenue is relatively low, since most cigarettes sold in Asia are
inexpensive products, the article reported.

The state-owned China Tobacco Corporation, the largest tobacco producer in
the world, currently dominates the Chinese market. The corporation=92s
market value is estimated at US$24.5 billion and it posted US$11 billion
in sales revenue last year alone, according to the article.

Cigarettes made by China Tobacco Corporation account for 92 percent of
China=92s consumption, a full one-third of the global total.