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U.S. Should Protect Public Health and Exclude Tobacco From Proposed Free Trade Area of the Americas

Statement of Judith P. Wilkenfeld, Director, International Programs, Campaign for Tobacco-Free Kids
November 19, 2003

Washington, DC — This week, trade negotiators from the United States and 33 other nations will meet in Miami to negotiate the proposed Free Trade Area of the Americas (FTAA). We strongly urge the U.S. and other countries to recognize the uniquely harmful nature of tobacco products and exclude such products from any trade agreement. U.S. policy should be to do everything we can to reduce tobacco use and its tremendous toll in health, lives and money around the world, and not to help the tobacco companies export and sell more of their deadly products overseas.

The FTAA negotiations are occurring amid evidence that the Bush Administration may be abandoning an executive order issued by President Clinton that stated, 'In the implementation of international trade policy, executive departments and agencies shall not promote the sale or export of tobacco or tobacco products, or seek the reduction or removal of foreign government restrictions on the marketing and advertising of such products.' In June 2001, the Bush Administration successfully pressured South Korea to reduce a planned 40 percent tariff on imported cigarettes. The Bush Administration also was successful in preventing a recently adopted international tobacco control treaty from giving public health laws precedence over trade agreements with regard to tobacco.

Today, U.S. Reps. Henry Waxman (D-CA) and Lloyd Doggett (D-TX) and U.S. Sen. Richard Durbin (D-IL) are releasing a letter detailing e-mails from Philip Morris, the world's largest tobacco company, urging the Bush Administration to support the elimination of tariffs on cigarettes in a free trade agreement with Chile last year. Philip Morris argued that the elimination of cigarette tariffs in the Chilean agreement would set a precedent for the FTAA and the current round of World Trade Organization negotiations. According to the congressional letter, the U.S. Trade Representative told congressional staff going into the Chilean negotiations that, due to public health concerns, the Administration would not support the inclusion of tobacco products in the agreement. However, the U.S. abandoned its position in the final hours of negotiations, and the final agreement announced in December 2002 eliminated tobacco tariffs.

The Bush Administration's actions raise the alarming prospect that it may be reinstating the U.S. government's shameful policy during the 1980s of supporting the tobacco industry in international trade disputes. During the 1980s, the U.S. used the threat of trade sanctions to force foreign governments to reduce tariffs on tobacco products and to repeal or weaken domestic tobacco control laws that the tobacco industry claimed violated international trade agreements. This policy undermined tobacco control efforts in countries including South Korea, Taiwan, Thailand and Japan. One study estimated these countries on average experienced a nearly 10 percent increase in cigarette consumption after their markets were opened to foreign cigarettes.

As shown by its recent efforts in South Korea and Chile, the tobacco industry is still fighting to reduce tariffs on tobacco products around the world. Reducing tariffs on tobacco products is bad public health policy because it reduces prices and boosts consumption, especially among children. The tobacco companies also continue to challenge domestic tobacco control laws as violations of trade agreements. In a recent example, Philip Morris threatened to challenge Canada's proposed ban on misleading cigarette descriptions such as 'light' and 'mild' as a violation of the North American Free Trade Agreement and an international agreement on patents and trademarks.

By excluding tobacco products, future trade agreements can make it impossible for the tobacco industry to continue these harmful practices and instead protect nations' rights to enact tobacco control laws that protect the health of their citizens. Trade agreements are supposed to benefit consumers by spurring competition and reducing prices for beneficial products such as wheat, computers and auto parts. But tobacco products are not beneficial, and trade agreements that reduce tobacco prices and increase tobacco consumption only bring more addiction, disease and death. Trade agreements should recognize that tobacco products are uniquely harmful and require special rules similar to those that already apply to trade in other hazardous products, such as hazardous wastes, small arms, landmines, narcotic drugs, ozone-depleting chemicals and persistent organic pollutants.

Globally, tobacco kills almost five million people each year. If current trends continue, it is projected to kill 10 million people a year by 2020, with 70 percent of those deaths occurring in developing countries. According to the Pan American Health Organization, tobacco already kills more than a million people a year in the Americas, including 440,000 deaths in the U.S. alone. U.S. leadership is sorely needed in combating this epidemic in our own region and around the world. We urge the Bush Administration to renew the Clinton Administration's executive order against promoting the sale or export of tobacco products and to support the exclusion of tobacco products from the Free Trade Area of the Americas and other trade agreements.

Download a copy of the Waxman/Doggett/Durbin letter re. Philip Morris' emails urging the Bush Administration to support the elimination of tariffs on cigarettes in a free trade agreement with Chile.