Contraband cigarettes swarm into South Africa

March 13, 2012
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A pedestrian walks past cigeratte ends on the street/XINHUA
CAPE TOWN, Mar 13 – The past decade has seen contraband cigarettes swarming into South Africa, dealing a blow to the economy, authorities said on Tuesday.

During the period, law enforcement agencies seized 1,000 tons of cigarettes in Limpopo, Gauteng and at Durban harbour alone, according to the SA Revenue Service (SARS).

Between January and December last year, 1.2 billion cigarettes were confiscated, and a recent operation led to the seizure of 18 million contraband cigarettes from containers in Durban harbour, SARS said.

Most of the contraband cigarettes – 70 percent – came from Zimbabwe, and around 10 percent from Dubai, the United Arab Emirates, SARS said.

About 347 alleged smugglers have been arrested over the past 10 years, it said.

Meanwhile, the Tobacco Industry of Southern Africa (TISA) said the smuggling of contraband cigarettes was dealing a blow to the economy by forcing tobacco farmers to retrench workers and close down businesses. The practice also led to the losses of at least 15,000 jobs over the last 10 years, TISA said.

The illegal trade of cigarettes was crippling the industry as they were sold at lower prices than the legal product, said TISA chairman Francois van der Merwe.

Despite an increase in the number of people smoking, the industry was seeing a decrease in profits as more people opted for contraband cigarettes, he said.

More than 4 billion rand (about 53 million US dollars) was lost due to sales of the smuggled product in the country where the tobacco industry generates more than 10 billion rand (about 1.3 billion US dollars) annually, according to SARS.

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