False economy: how the tobacco industry is distorting Africa’s economy

If you want to get a sideways look at the damage caused by the tobacco industry – apart from its direct health effects – and to understand better how pervasive the influence of the tobacco industry globally is, have a listen to this recent BBC Radio 4 report, The Battle for Hearts and Lungs, which investigates how the tobacco companies are branching out into the developing world  in search of new markets.

In countries such as Malawi, where the programme is mostly based, tobacco has been designated a strategic crop because of its importance in the economy – meaning that farmers are encouraged to grow it instead of growing food. According to the programme, 60% of the country’s foreign earnings come from tobacco and tobacco growing is seen as a route out of poverty for Malawi.

But of course things are not that simple – the tobacco farmers at the bottom of the pile get very little for their crop (6 c per kilo for something probably worth upward of $2) with the market tilted in favour of the buyers and hence the tobacco companies. The result is a terrible cycle of poverty with farmers trapped in debt after buying fertilizers and other necessities to grow the crop then being forced to sell at any price to get cash. This is shocking in an industry that makes billions of dollars of profit each year for its multinational paymasters, but which only brings around $300 million to Malawi.

Even leaving aside the other insidious effects of this industry in Malawi – the use of child labour by small farmers to harvest the crop and of course the short and long term health damage caused by tobacco – it’s hard not to conclude that Malawi has made a pact with the devils, which it is losing badly.