5.1. The adverse health impact of tobacco investments

Recently, public health groups have raised concerns about the impact that foreign tobacco investments in state cigarette enterprises could have upon health. If tobacco factories with foreign investments produce cigarettes more efficiently, the result may be lower cigarette prices and products with better appeal to consumers. Moreover, foreign investors use aggressive marketing techniques and distribution systems to increase their market share and sales, which leads to higher overall cigarette consumption. In other industries, lower prices, more appealing products, easy accessibility, aggressive marketing and higher sales may be entirely positive. But cigarettes are a unique product -- when used as intended, they kill. Thus, if foreign investments increase cigarette consumption, this will lead to higher health care costs and a higher burden of ill health and premature deaths for smokers, families, society, and the economy. When assessing the expected or actual impact of foreign investments, it is important to consider both the positive and the negative impacts, and to put a regulatory framework in place that minimizes the harmful effects, so that society can enjoy the greatest possible net benefit from foreign investments, and not end up worse off than before.