Back in 2020 before the Covid lock downs British American Tobacco had nearly 50% market share of the total South African cigarette market. Today it has less than 10% with the rest being lost to black market illicit sales.
The one industry I know so much about is the cigarette industry having spent most of my career working for a Blue Chip tobacco company. In the past one of my roles was to locate and seize counterfeit cigarettes and this was a very interesting role that involved in most cases thinking out the box and out witting the criminals benefiting from the industry you were working for.
This week Parliament is trying to push through standard plain packaging for all cigarette brands which is simply going to create a far bigger problem. The idea that a cigarette box is advertising that particular brand is not going to change anything. Removing that branding however changes everything and it opens the floodgates for illicit brands from neighboring countries to flood the local market. The problem is you lose all the controls you would have had in place before.
It is obvious if you have a genuine item and a counterfeit item placed side by side you can spot the subtle differences immediately in the packaging. If you now have two plain packets next too each other it will be virtually impossible to spot immediately and forces you to check each and every coded stamp on the box. With a plain pack the code stamped will be harder to read because the white packaging does give it no real depth versus a color back ground.
Already the government has various bans on retail tobacco display units and any forms of point of sale advertising. The idea is to basically reduce the cigarette sales over time, but having an illicit trade that is booming offering cigarette sales that are not traceable that are much cheaper as they do not include the excise duties.
Illicit trade already makes up for 75% of the total cigarette trade in South Africa and moving to a standard plain packaging would see that number rise even more. If the cigarette trade is regulated properly like this is happening in 25 countries around the world then yes over time this will help reduce the number of youngsters starting to smoke. The problem with SA the opposite will happen as the regulators and police along with customs and excise are either useless, corrupt or generally have no idea what they are doing. I would say they are copying the other countries in what they are doing, but have no systems in place to stop the illicit trade and why this will never work.
Back in 2019/2020 when SA had the Covid lock downs the sale of cigarettes was banned. The result is the black market boomed and as expected the sales did not decrease and in an around about way the government fueled the illicit trade. One has to ask if this was done on purpose knowing this would happen and I would suggest this was. The health minister at the time who ordered the cigarette ban later had her sons caught dealing in the black market with alcohol and cigarettes. This entire ban was set up to help her kids prosper which was a proper mafia move.