The tobacco transnationals transform markets in developing countries and Eastern Europe in at least two ways: First, they introduce slick marketing techniques that have great appeal among populations unfamiliar with the ways of Madison Avenue. Second, they kick-start domestic manufacturers, either through competitive pressure or through joint ventures or corporate acquisitions. Thus traditionally sleepy domestic companies become aggressive marketers.

The tobacco companies are pouring substantial resources into advertising and promotion in developing countries and Eastern Europe and the former Soviet Union. Tobacco accounts for a reported 40 percent of advertising in Russia. Philip Morris is the lar gest advertiser in China.

Selling Smoking to Women and Children

The expansion of U.S. companies' overseas operations creates more smokers, especially among children and women.

• In the year after the U.S. Trade Representative forced South Korea to open its market to U.S. cigarette producers in 1988, smoking rates among boys rose from 18.4 percent to 29.8 percent, according to a General Accounting Office (GAO) study. The rate among Korean girls quintupled, from 1.6 percent to 8.7 percent.
• Analysts at the National Bureau of Economic Research in Cambridge have concluded that the entry of U.S. firms in Asian markets led to a 10 percent increase in smoking rates.
• CNN reports that two out of three men in Russia now smoke, up from one in two a dozen years ago -- before foreign corporations entered the market. Smoking rates among women have tripled during the same period, from 10 percent to 30 percent.

Marketing to Children

In most developing countries and Eastern Europe, where smoking regulations are minimal or poorly enforced, the U.S. tobacco companies directly target children with free cigarette giveaways, sponsored rock concerts and a constant barrage of television a nd radio advertisements.

• At the Canton Disco in China, R.J. Reynolds pays internationally known artists to perform, distributes free cigarette samples during the shows and advertises Salems during and after the show.
• In Beijing, Philip Morris underwrites the radio program, the "Marlboro American Music Hour," featuring songs by Elvis Presley and Michael Jackson.
• Last year, Philip Morris sent a traveling disco to the Siberian city of Novosibirsk with processional dancers, an elaborate light and sound system and staff dressed in Marlboro gear. The price of admission to the heavily advertised event was five empt y packs of Marlboros, three for students.
• Around the world, RJR and Philip Morris give away or sell toy trucks, CDs, hats, t-shirts and an array of other merchandise prominently featuring cigarette logos and names.

Tarnishing America

Much of the U.S. tobacco company advertising shamelessly plays on the attractiveness to youth worldwide of perceived American values of freedom, hip-ness, vitality and material comfort. Increasingly, as the tobacco companies employ marketing strategies that combine the popularity of American culture with rock music, sports and other appeals to youth, America's representative abroad is the Marlboro Man.

• "Internationally, Winston is seen as freedom," says RJR Chair Steve Goldstone. "It's seen as very American. That product is going to grow."
• Advertisements in Asia use slogans such as "Winston. Spirit of the U.S.A." and "Lucky Strikes. An American Original." Ads in Eastern Europe encourage consumers to "Discover the taste of freedom" with the New York skyline prominently splashed across th e billboard and to taste "American Quality."

The Warning Gap

Cigarettes sold by U.S. companies in the developing world and in Eastern Europe and the former Soviet Union generally come with inadequate warnings, warnings written in English or no warnings at all.

Warning labels are a very modest counter to the aggressive marketing of tobacco products, but they could have a somewhat more beneficial effect in developing countries and Eastern European markets, where many smokers really do not know of the health ri sks associated with smoking.

Ending the Hypocrisy; A Child is a Child is a Child

A first step in addressing these problems is to demand that the tobacco companies adhere to the same marketing and labeling standards abroad as at home, that the protections we afford to children and adults in the United States are afforded to children and adults around the world.

If the FDA deems Philip Morris billboards near schools in Milwaukee an attempt to market, then the same standard should apply to Philip Morris billboards in Manila. If smokers or potential smokers in the United States deserve warnings about the health risks of smoking, then so too do smokers or potential smokers in Russia.

Many currently proposed tobacco bills would apply a single standard to U.S. companies' marketing and labeling practices. This provision would mandate that U.S. companies must meet domestic marketing and labeling standards in their overseas operations, including those of their subsidiaries and affiliates.

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For more information, Contact:
Essential Action
Robert Weissman: Tel: 202-387-8030

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