Preferential regional trade agreements appear to have fostered the consolidation of cigarette production, which has characterized the trade patterns of tobacco leaves. Since 2002, British American Tobacco has been investing in tobacco production plants in Nigeria, Kenya and South Africa, strategically located to serve different parts of Africa. This was followed by the closure of British America Tobacco factories in Ghana, Rwanda, Uganda, Mauricie and Angola. At the same time, Malawi and Tanzania exported a significant percentage of tobacco leaves to European countries. After 2010, tobacco exports from Malawi and Zambia to China increased, which could be due to preferential trade agreements between the EU and China and these countries. Economic liberalization has been accompanied by a greater affordability of cigarettes for the countries included in our analysis. However, only excise duties and revenues affect cigarette prices in the region. Krüger A. Why trade liberalization is good for growth.
Econ J. 1998 Sep 108 (450):1513-22. On the contrary, several World Trade Organization (WTO) agreements as well as some regional and bilateral agreements contain a language that, for certain public health measures, constitutes an „exception” to trade rules. These exceptions provided little or no real protection for public health measures. As written, they pose health problems to the right of companies and countries to act freely. Hiilamo H. Tobacco industry strategy to end tobacco control in Finland. Control tob. 2003 Dec 1;12 (4): 414-23. In addition to investments, some TTC have streamlined their operations by consolidating production in fewer countries within the SSA.
Bat invested about $12 million in increasing production at a plant in Kenya, after closing its factories in Uganda and Rwanda in 2006 and Mauritius in 2007 [61, 62]. While reducing production costs was part of the logic, it is important to note that Kenya, Rwanda, Uganda and Mauritius are all comesA members, while Kenya, Rwanda and Uganda are EAC members. Preferential trade agreements appear to have marked this consolidation which, in turn, has marked the trade patterns of tobacco leaves in the region. For example, BAT has invested heavily in Nairobi`s tobacco and cigarette production plants, which use both domestic leaves and imports from COMESA and EAC countries. Similarly, the BAT plant in Ghana was closed in 2006 and regional production was transferred to Nigeria; both countries are members of ECOWAS . In addition, BAT has modernized and modernized its processing and manufacturing center in South Africa to serve as a production center in Southern Africa. After this stage, they closed their factories in Angola in 2007 and Zambia in 2006, all three countries being members of SADC [63, 64]. . . .