British American Tobacco's tactics during China's accession to the World Trade Organization

Background

China entered the World Trade Organization (WTO) in 2001 after years of negotiations. As a WTO member, China had to reduce tariffs on imported cigarettes and remove non‐tariff barriers to allow foreign cigarettes to be more competitive in the Chinese market. Among foreign tobacco companies, British American Tobacco (BAT) was the most active lobbyist during China''s WTO negotiations.

Objective

To review and analyse BAT''s tactics and activities relating to China''s entry into the WTO.

Methods

Internal tobacco industry documents were reviewed and are featured here. Industry documents were searched mainly on the website of BAT''s Guildford Depository and other documents'' websites. 528 documents were evaluated and 142 were determined to be relevant to China''s entry into the WTO.

Results

BAT was extremely active during the progress of China''s entry into the WTO. The company focused its lobbying efforts on two main players in the negotiations: the European Union (EU) and the US. Because of the negative moral and health issues related to tobacco, BAT did not seek public support from officials associated with the WTO negotiations. Instead, BAT lobbyists suggested that officials protect the interests of BAT by presenting the company''s needs as similar to those of all European companies. During the negotiation process, BAT officials repeatedly spoke favourably of China''s accession into the WTO, with the aim of presenting BAT as a facilitator in this process and of gaining preferential treatment from their Chinese competitor.

Conclusions

BAT''s activities clearly suggest that tobacco companies place their own interests above public health interests. Today, China struggles with issues of tobacco control that are aggravated by the aggressive practices of transnational tobacco companies, tobacco‐tariff reductions and the huge number of smokers. For the tobacco‐control movement to progress in China, health advocates must understand how foreign tobacco companies have undermined anti‐tobacco activities by taking advantage of trade liberalisation policies. China should attach importance to public health and comprehensive tobacco‐control policies and guarantee strong protection measures from national and international tobacco interests supported by international trade agreements.China is the largest tobacco producing and consuming country in the world, with over 350 million smokers in a population of 1.2 billion.^1,2 China''s cigarette market is dominated by a state‐owned monopoly, the State Tobacco Monopoly Administration, which strongly protects the domestic tobacco industry.³ This largest cigarette market in the world is nearly 3½ times the size of the US cigarette market and over 12 times the size of the German cigarette market, which is the largest in Western Europe.⁴ However, as smoking rates have fallen in North America and Western Europe,⁵ transnational tobacco companies (TTCs) from the US and Great Britain have turned to international cigarette markets to seek greater profits.China entered the World Trade Organization (WTO) in 2001 after years of negotiations.⁶ As a condition of WTO membership, China had to reduce tariffs on imported cigarettes and remove non‐tariff barriers to allow greater competitiveness for foreign cigarettes in the Chinese market.⁷ O''Sullivan and Chapman⁸ and Lee et al⁹ studied TTC industry documents and described TTC aims and conduct in China. Those studies mainly focused on the heavy reliance on contraband and the undermining of national advertising bans. However, no previous papers have examined China''s entry into the WTO on the basis of tobacco‐industry documents. British American Tobacco (BAT) was engaged in the most active lobbying during China''s accession to the WTO. This paper reviews and analyses BAT documents related to China''s WTO negotiations to clarify BAT''s tactics and use of international trade policies to support their corporate interests.