Economics of tobacco control – the Maldives

In the year 2003, myself and Dr. Ibrahim Riaz Shareef did a study on the economics of tobacco control in the Maldives. This paper was done for the World Health Organization and presented at a meeting on the Economics of Tobacco Control in the South East Asia Region held in Jakarta from December 3 – 4, 2003. This study was later published by the WHO-SEARO and World Bank and is also available at the e-scholarship database as well.

Economics of Tobacco Control - The Maldives full report

When I look back at that study and the recommendations that we made in 2003, nothing much has changed. In fact things look much worse that at that time.

For example, there has been n o gradual increase in the taxation of tobacco products up until this year when the rate of taxation per stick has been raised to 90 Laari. However, the incidence of tax on tobacco is still the lowest in the South East Asia Region and needs to be implemented. The current proposed draft regulations under the Law has many provisions for such incidences of taxation.

The prevalence of smoking has gone up and the female smoking rate has increased rapidly. The prevalence of non-communicable diseases have gone up and the leading cause of death in the country is now cardiac diseases. There is no proper cancer registry still and the direct impact of tobacco on health in the Maldives remain to be assessed.

The Law although an achievement is weak and the regulations are pending with a claim that gold standards in tobacco control regulation does not suit the Maldivian way of life and social structure. Something needs to be done to save Maldivians from the tobacco menace.

Following is the summary of the report. Click the image to read the full report.

Country Situation

The Maldives, an archipelago of about 1190 islands, lies in the middle of the Indian Ocean. The population was 269 010 in 2000. Per capita GDP was estimated at US$ 1279 in 1998, twice as high as the regional average, and has a growth at an average of 9% for the past 25 years.

The Maldives’ social welfare indicators are good compared to most countries with comparable income levels. Adult literacy rate is close to 1005. Infant mortality hd fallen to 35 per 1000 by 1995, and the crude death rate to 0.5%. Life expectancy at birth was 72 years in 1998. Cardiovascular and respiratory diseases and cancers are the 3 leading cause of death; they are all linked to tobacco use.

Curative and preventive health services are organized into a four-tier system comprising of central, regional, atoll and island levels. Services are provided through both public and private sectors.

Tobacco imports and tobacco control

Most tobacco products are imported, imported volumes are increasing. Cigarettes account for 97% of all tobacco products by quantity. There will be little local tobacco productions – just a small amount of bidi and tobacco for hukkah – in the Maldives. Tobacco smuggling is believed to be negligible. There are no specialist tobacco importers or retail outlets in the country. Thus no jobs would be lost if tobacco sales were to fall.

Maldivian tobacco control goes back to a 1942 law which banned tobacco product imports for some years. A 1947 bill that was enforced for a period of time banned smoking by all students and Maldivians under the age of 17, and prohibited smoking in public. In 1984, advertising was banned in government media, and in 1994 a total ban on all forms of advertisement and promotion was imposed. Smoking was banned in all health care facilities in 1993, and in all government buildings and educational institutions in 1994. Islands declaring themselves tobacco-free may qualify for trophies and cash prizes. In 2000, a large-scale school anti-tobacco programme was initiated by education sector for the whole country. One tobacco-free island, Madifushi, runs a quit smoking programme that provides accommodation and food for people who come to the island to quit smoking. This island received a WHO tobacco-free award in 2000.

Prevalence and consumption

A survey conducted in 1997 showed that 57% of males and 29% females consumed some form of tobacco, and the smoking prevalence stood at 41%. Prevalence is higher in the outlying islands. Per capita consumption is highest in the 15 – 49 age groups, and averages 14 cigarettes a day for men and 10 a day for women.

Prices, taxes and government revenue

Prices of cigarettes were relatively stable (in nominal and real terms) from 1997 to 2000. In 2000, prices rose steeply but then fell to 40% above the earlier price. Until May 2000, duty on all imported tobacco products was 50% of CHF value. In 2000 the levy for cigarettes only was changed to 30 laari per cigarette (100 laari = 1 rufiyaa) to reduce cigarette price differentials and eliminate trade in cheap cigarettes. The overall effect was positive for revenue and public health: imports dropped and import duty revenue rose by over 50%. Tobacco duty revenues have fallen as a share of all import revenues from around 4% to below 2%.

Policy recommendations

There should be an annual increase in tobacco prices. The World Health Organization recommends an annual 5% increase in the real price of tobacco products. Tax increases should apply to all tobacco products. The Maldives should consider introducing an ad valorem excise tax to sustain increase tobacco prices.

Tobacco control measures should be consolidated and a comprehensive tobacco control law formulated as a foundation for ratification of the Framework Convention on Tobacco Control. The National Tobacco Control Committee needs to be revamped to play a more active role in tobacco control. Surveillance and enforcement need to be enhanced. An assessment of smoking prevalence in the Maldives should be done every five years, as part of the existing regular household surveys.

The government should implement a smoking cessation programme.

Information, education and communication programmes need further innovation and strengthening.

The government should also improve routinely gathered data such as the cancer registry and lifestyle-related disease statistics so that the smoking-attributed burden of disease can be better understood. The government should also consider revising death certificates to include smoking status in order to enhance future research.



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9 Comments on "Economics of tobacco control – the Maldives"

  1. meekaaku
    08/10/2011 at 14:16 Permalink

    What next sugary food? sweets? oily food? Should we not tax them all because they are also harmful to health.
    We should tax very highly the food with huni such as most hedhikas, huni roshi etc, since huni is a big factor in cholesterol levels.

    Also we should tax ppl who do not do excercises regularly, and government should keep track of who is doing what exercises.

    But why tax? why not ban them and be done once and for all. why spend so much money collecting and administering the revenue and expenses?

  2. afaal
    08/10/2011 at 16:59 Permalink

    Very interesting questions. In fact many european countries are now imposing a so called “fat tax” exactly for the reasons that you have mentioned.
    Will be very interesting to see where we head with all the non-communicable diseases in the country…

  3. non-Smoker
    08/10/2011 at 17:03 Permalink

    @meekaaku: You sir, are obviously a smoker.

    I fully support the recommendations of this report.

  4. meekaaku
    09/10/2011 at 00:25 Permalink

    Not sure how it was obvious to you. But I am not a smoker. Never have.

    So you do support such taxes then? Then I have a manual for you
    to implement such a society. Its called 1984 by George Orwell.

  5. afaal
    09/10/2011 at 05:58 Permalink

    First we have to grow as a society and learn a “thaahiru dhiriulhun”. These tobacco control issues have so much resistance that apparently controlling it is against the “greater public good” in some very high politicians’ mind.

    I have been advocating for stronger tobacco control matters because it is really in a bad situation in Maldives and for the good of all Maldivians. As an individual I will keep doing this and try to achieve the best practices in tobacco control in Maldives like those other countries who have managed to do it.

    If more people advocate for this, the impact will be higher.

    As per the taxes, well for tobacco taxation changes for the good is my initial priority. I agree to other such taxes but at present the most needed is that of tobacco.

  6. Hassan Mohamed
    09/10/2011 at 07:22 Permalink

    We should take a deeper and holistic view of tobacco to understand this product for what it is and for what it does, and to finyally realize why it is being tackled differently. While there are many other consumer products and lifestyles that contribute to non-communicable diseases, tobacco glows out for all the wrong reasons.

    Many of the so-called “unhealthy”,”fatty”,”sugary” foods and drinks do have benefits and utility to human body and some are even essential to the very function of our body…but provided they are taken in the right amounts and combinations. Tobacco has no known utility or benefit to human body. For the consumer , his or relatives, friends and loved ones, and for the nation tobacco presents the greatest health and economic loss….this from something we can live without.

    Those who eat unhealthy food or do not excercise may not be harming others but themselves. But consider tobacco;, from the very first cigarette you puff till your last agnizing breath, there are others around the smoker who gets hurt just as the smoker continues to harm himself.

    Healthy eating habits and excercise may be promoted through health promotion and advocacy. But tobacco, whic contains the strongest addictive substance ever known..i.e “nicotine” is addictive, and therefore, as we have seen throughout history, requires more than health advocacy.

    Price, or raising the price of the product, ideally through taxation has been shown around the world, to be the most effective tobacco control measure. Maldives is no exception.

    As for your suggestion, for a total ban….that’s a great idea. But a caring society, dealing with an addiction, would think otherwise. A multi-pronged approached with measures addressing both supply and demand issues may be best for ridding the society of this the long run.

  7. meekaaku
    09/10/2011 at 14:33 Permalink

    Lets be one thing clear. I also consider smoking is detrimental to health and also consider it a very bad habit. However, what I disagree with you is how to address this issue. I am all in support of voluntary means of organizing to advance awareness etc. and I commend you if you are involved in such efforts.

    But what I disagree is the use of the force of law to impose changes in behavior (unless its a criminal act or harm others). Or atleast reduce such intervention to a minimum. Smoking has been a habit of humans for thousands of years and its not going to go away due to taxation. Such paternalism is detrimental to human freedom.

    @Hassan mohamed.
    A total ban is a great idea? Suppose we ban cigarettes. What will happen? Most likely it will be the creation of black markets in cigarettes. It will be enormously profitable to deal in that, and the most ruthless ppl will become the ring leaders, and will result in gang violence. By a ban, the government is effectively stifling the competitors. What more could a businessmen want? No amount of surveillance and monitoring will address the root cause. Just look at the the War on Drugs in America/Mexico. The whole reason drugs are that profitable is because of the ban. Probably the same situation occurs here in Maldives.
    So I don’t think a ban is the hallmark of a caring society since it does absolutely nothing to address the real issue of addiction. It should be addressed as a socio-medical issue, not a criminal issue (which is what a ban is effectively). This is the reason why the world over is looking for decriminalization/legalization, because banning has failed terribly.

  8. afaal
    09/10/2011 at 15:35 Permalink

    @ Meekaaku:
    Law has been where all countries have been successful in implementing control measures. All these years, all countries have promoted healthy behavior and awareness creation. But, health experts, economists and the like all came to a conclusion that only laws can curb the epidemic.

    Why would the World get together and form the only Public Health Convention ever and to date on tobacco control? Why would a 174 parties ratify the Convention in record time? And, why would 120 countries have implemented strong Laws to control tobacco. Of which the Maldives’ Law is amongst the weakest.

    All research points to reduction of both supply and demand measures to control tobacco through strong laws. These Laws should address many issues for which the Framework Convention on Tobacco Control is the gold standard. It’s just tough decisions that governments should have to take for the benefit of its people. May be we do not have that courage. I will be one person in the front line to stand up for tobacco control as I have always been.

    Well one country in the world (Bhutan) has imposed a total ban on tobacco by Law. A lot of courage and determination from the Parliamentarians. And this stand has later been reaffirmed also by the Bhutanese Parliament. So far the issues are less but of course there is and will be resistance to such measures.

    I thank you for sharing your views and I respect that too. Intellectual discussions are good. Its just that, when it comes to tobacco, I will be a hard nut to crack. Thanks

  9. Hassan Mohamed
    09/10/2011 at 16:25 Permalink

    Just a correction. I was not advocating a total ban, quite the contrary, I was reiterating that its not a wisdom for a caring society. By the same token, a caring society should not sit idle when its beloved members are harming themselves needlessly through addiction and irresponsibility.

    I think we are all on the same page regarding the magnitude of the issue and the fact that it boarders around the domain of freedom of choice. Well said, tobacco is not an illegal product, but many scholars today argue that it is haram, on the basis of self-harm and wastefulness, among others.

    I have not heard a sigle voice or seen a single legislation in this country calling for criminalizing the use of tobacco, or penalizing people for enjoying a smoke (its a false notion of enjoyment). Penalties are proposed for acts by tobacco vendors or smokers when they harm others, cheat the authorities or involve minors etc. You are free to smoke all day and night, if you can afford it, and if you don’t cause nuisance or harm to others or infringe on the rights of others….when you are exercising your so-called right to smoke.

    Let us not loose focus and get confused.. The real issue is ‘tobacco control’. Even when smokers themselves wish they can quit it, why would any one has a problem with tobacco control efforts? Only corporate greed would stand in the way. Period!

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