Wed, Feb 04, 2004 - Page 16 News List

Indonesia becomes the puffer's paradise

The country's manufacturers of clove-flavored cigarettes, or `kreteks,' have resisted international pressure to increase taxes on their products

DPA , Jakarta

"This tax freeze policy came from the parliament after lobbying by the cigarette companies," said Soewarto Kosen, a tobacco expert at the National Institute of Health Research and Development.

Kretek manufacturers are powerful players on the Indonesian economy. The three largest companies -- Gudang Garum, Sampoerna and Djarum -- account for 76 percent of the cigarette market, and are listed among Indonesia's top 10 companies in sales and profits.

They also have political clout, as many cigarette companies are known to give funds to political parties for their election campaigns. Indonesia is scheduled to hold a general election on April 5, and its first direct presidential election on July 5.

Many cabinet ministers have openly supported the tobacco industry because it is a significant source of employment, a hot issue in a country where an estimated 45 million people are without work.

Some 245,000 Indonesians are employed in cigarette factories, while 900,000 work as tobacco farmers and another 1.2 million are clove farmers.

With many of Indonesia's kretek companies and tobacco farms based in Java, which accounts for more than 60 percent of the country's population, and voters, health officials are holding their breath until after the election to resume their anti-smoking campaigns.

"We hope that after the election, this decision to freeze cigarette taxes will be re-examined by a new government," said Kosen.

This story has been viewed 5336 times.
TOP top