Saturday, December 15, 2012

Greece Goes Up In a Puff of Smoke


My blog last Saturday was about Greece and corruption, a topic that led one of my Mykonian friends to leave a note on Facebook:  “Jeffrey—Enough with the corruption, let’s go fishing.”

Sound advice.  I think everyone in Greece would rather go fishing.  So, I decided to do a pictorial piece on fishing.  But then Leighton frightened me away from the water with his piece on piranha.  So, I looked elsewhere and that’s when an article caught my eye in Ekathimerini, the online version of Greece’s newspaper of record.  

It’s not about fishing, but it does extend to perhaps the most popular activity in Greece. No, I’m not back on corruption, nor does it require involving two (or more) consenting adults.  I’m talking about smoking.

Greece alone in a deep blue as intense as its smoking habit
Greece has one of the highest smoking rates in the world.  Indeed, the article says that taxes on smoking account for 4% of Greece’s national revenue.  I don’t know where that number comes from, but I did find that ten years ago tobacco taxes accounted for 7.72% of Greece’s revenues and six years ago for 8.69%, only slightly behind China for the #2 spot in those years.

Anyway you look at it smoking is big in Greece.  And that means big business.  So, this is the headline that caught my eye.  “Philip Morris shows its faith in Greece.”

Wow, support from an international corporate giant in Greece’s moment of direst need.  The very thought warms the cockles of my heart…or rather cockles the heart and warms the lungs. 

So what act of faith by this global tobacco giant garnered such a headline?

Philip Morris International is moving a production line to Greece!  Yay, more cigarettes available for financially strapped Greeks to buy. 

Cigarette production line.
From the article it all fits together nicely with the Greek tobacco industry’s decision to “restructure its distribution network in [the most populated parts of Greece]…in order to secure the optimum presence of its products at the points of sale and the sustainability of the traditional retail trade, which has been suffering in the last few years.”

In other words, smoking has been declining in Greece and big tobacco sees this as an opportunity to get Greeks back to puffing away even more, and in these days of financial crisis be applauded for the effort.   I’m sure the nation’s impoverished and overrun health care system is just jumping for joy at the possibilities.

And what is this act of faith costing Philip Morris?  It is making an investment of—coronets please—three million euros (3.9 million dollars).  Yes, that’s million, not tens of millions, not hundreds of millions, and certainly not the billion moniker linked to practically every other mention of euros and Greece in the same breath these days.

I know, to be fair, one should take into account the desperately needed jobs this will bring to a population staggering under (smoking) unemployment.  So, how many new jobs is this creating?  The answer given by Greece’s deputy development minister at the inauguration of the facility was “in coming years new jobs will come.”  Put differently, no new jobs just new smokers.

Still, three million euros is three million euros, and Philip Morris is taking a risk at putting its money into Greece.  Well, sort of, but then there is another comment from that same deputy minister: “authorities had confiscated 1.5 million packs of smuggled cigarettes last week.” 

The only reason I can think of for why the deputy minister made such a comment at that event was to impress upon big tobacco that the Greek government was committed to keeping illegal cigarettes from competing with legitimate sales.  To the extent increased enforcement may have played a part in Philip Morris’ investment decision is something I do not know, but it certainly makes sense for big tobacco and Greece.  Or rather, it makes euros for them both—mega millions of euros.

The cost of a pack of cigarettes in Greece currently averages about three euros, cheap compared to the rest of Europe. Still, if in just one week 1.5 million packs of illegal cigarettes are taken off the market, Philip Morris has a shot at 4.5 million euros in additional sales.  On an annualized basis that’s a more than 230 million euros!

Hmm, that one-time three million euro investment (without additional labor costs) for a shot at sharing in a potential 230 million euro additional annual market seems more like a brilliant (or no brainer) business decision than an act of faith. 

But what do I know.  I should be fishing, and not looking a gift horse in the mouth. After all, it might bite my head off.  Or, in this case, asphyxiate me.

Jeff—Saturday

A Personal Postscript:  I don't think there is a soul on earth who hasn't heard of the tragic, horrendous, inexplicable slaughter of twenty so very young elementary school children and six adults in rural Newton, Connecticut by a lone, now dead twenty year-old gunman.  I've been listening to the coverage all day and am numb.  I don't know what to say, except for what the world is saying: Pray for Newtown.

8 comments:

  1. I can't even begin to fathom the tragedy in Newtown, want to bury myself in crime fiction and not think about it. Another senseless situation, the failure of the mental health system, guns all over the place. What is it with guns? Why do some people think they need them? Are we living in Tombstone in the 1800s?

    And why is this happening more frequently? How many angry, alienated, ill young men are out there? And why aren't they getting a lot of help, intervention, and more? Praying isn't going to stop it. It needs drastic action from many directions.

    But to the point of the post, what about the rate of lung cancer and emphysema in Greece? And asthma even from second-hand smoke?
    It must be horrendous.

    And the tobacco companies should be changing their products to something healthier at this point when so much is known about the awful effects of smoking.

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  2. Kathy, thanks for your thoughts. I only wish our politicians would enact laws to address your concerns.

    Serendipitously (to my mind, at least), your comment raised a common thread between the subjects of your thoughts: In both Greece and the US there are far too many powerful lobbies (not called that in Greece) working day and night to block any meaningful common sense legislation...at least until now.

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  3. As a former smoker, I can understand how the addictive properties of cigarettes make it hard to quit smoking. As a part time resident of Greece, I also know that the Greek people, when told that smoking was not allowed indoors in restuarants and bars by law, scoffed at obeying such a law. Never tell a Greek that he or she may NOT do something; it's a guaranteed way to have the opposite effect. Sort of a Br'er Rabbit and Br'er Bear tale: "Please don't throw me in that briar patch". Perhaps a campaign by the government, pleading with the smoking citizenry to never abandon their cigarettes, as the government needs that tax revenue to survive, might just have the desired effect. One thing Greeks hate more than being told what to do is paying taxes!

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    1. LOL. Why do I think I know who wrote this amusing little reply. And because I do, I understand why you chose anonymity. Happy Holidays.

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  4. Thank you for your comments about what happened in Connecticut - I live in Manhattan and this little town is like a close neighbor to us... the massacre of those little children is so heartbreaking it opens up all the old wounds of 9/11 - only this was all the tiny innocents and somehow more inexplicable, as no international politics were involved, only a sick mind slaughtering the tiny ones. Thelma Straw in Manhattan

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  5. Your point is well taken, Thelma. I feel a bit as I did on 9/11 when I watched the Twin Towers fall from my office window. It's as if we've risen to a new quantum level of horror. Where even children fit into the twisted plans of deranged minds. God help us.

    My mother's name was Thelma. She also was a wonderfully caring person. Thanks for making me think of her.

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  6. I think I want to go fishing, and hug your loved ones more tightly today.

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  7. It would be less than human not to want to do that, Lil.

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