[Intl-tobacco] Take Action! Prevent privatization of Thai Tobacco Monopoly

[Robert Weissman]

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TAKE ACTION! Prevent Privatization of Thai Tobacco Monopoly
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Dear Friends,

Last week Thailand's Finance Minister Somkid Jatusripitak announced
plans to privatize the country's tobacco monopoly (TTM).  This is bad
news for public health in Thailand, as it will allow multinational
tobacco companies to strengthen their foothold in a country that has
long resisted their predatory expansion.

Dr. Hatai Chitanondh, a GPTC advisory board member and dedicated Thai
tobacco control activist, has launched a campaign to prevent the
privatization and asks for your support!

Please send your opinion about the planned privatization to:

Dr. Somkid Jatusripitak
Finance Minister
Email: <somkid@vayu.mof.go.th>
Fax: (662) 02-273-9404

Please bcc your emails to: <pirayu@asianet.co.th>
                           <awhite@essential.org>

TALKING POINTS

* Thailand has been a world leader in tobacco control. Privatization of
TTM will undermine public health and ultimately lead to increased rates
of tobacco-related death and disease.

* Tobacco monopolies are not like other state enterprises, in that they
sell a product that kills people if used as intended. Thus, greater
"efficiency" and "competitiveness" should not be the goal.

* The Finance Minister should resist pressure from the IMF to privatize
TTM, and also work to exempt tobacco from regional trade agreements.

BACKGROUND

* The Thai Tobacco Monopoly plans to offer investors a stake of up to
30% in the enterprise by November 2002. TTM is also considering sale to
a "strategic partner," such as Philip Morris, British American Tobacco,
and Japan Tobacco. Read a Bangkok Post article:
http://lists.essential.org/pipermail/intl-tobacco/2002q1/000683.html

* In contrast to transnational tobacco companies that are beholden to
shareholders, state tobacco monopolies have little incentive to expand
their market.  They tend not to advertise aggressively, nor fight
tobacco control legislation.

* Proponents of privatization argue that privatization is necessary to
make tobacco monopolies more "efficient" and "competitive."  But as Thai
tobacco control advocates have responded: Is this an industry that
should be made more efficient? More efficient in encouraging people to
smoke? More efficient in killing people?

* Thailand is one of only a few countries to maintain independence from
tobacco transnationals by sustaining its state tobacco monopoly. In
1991, the infamous Thai-US 301 trade dispute and subsequent General
Agreement on Tariffs and Trade (GATT) verdict forced Thailand to open
its cigarette market to foreign brands. For the first 5-6 years foreign
cigarettes could capture only 2 - 3 % of the market share, because of
Thailands strong tobacco advertising restrictions.

* In recent years, Big Tobacco has built production bases in Malaysia
and the Philippines in order to ship cheap cigarettes into SouthEast
Asia. This has resulted in rapidly increasing market shares of foreign
cigarettes in Thailand.

* The plans to privatize TTM are in response to pressure from the
International Monetary Fund (IMF) to privatize all state enterprises,
and the the regional Asean Free Trade Agreement (AFTA), which cut
cigarette tariffs to just 5% this year and is scheduled to eliminate
them altogether by 2003 (allowing foreign cigarette brands to further
infiltrate the Thai tobacco market).

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Anna White
Global Partnerships for Tobacco Control
Essential Action
P.O. Box 19405
Washington, DC 20036
Tel: +1 202-387-8030
Fax: +1 202-234-5176
Email: awhite@essential.org
http://www.essentialaction.org/tobacco