Tobacco Asia

Volume 19, Number 3

Issue link:

Contents of this Issue


Page 45 of 75

46 tobaccoasia / Issue 3, 2015 (July/August) By Allen Liao China's STMA and the Tobacco Monopoly Under China's longstanding system of state tobac- co monopoly, cigarettes are regulated by the law on monopoly and are thus a special type of com- modity exclusively sold and traded by the govern- ment. For consumers, it is common to buy a pack of cigarettes from a retailer. But how does this pack of cigarettes go from producer to consumer? Some may say they go through the standard steps of production, distribution, and retail before they eventually land in the hands of consumers. Indeed, cigarette production and marketing in China do, at first glance, comply with such basic processes, but the realities are definitely different than that. So, what is different then? Let's take a look back at what happened with the tobacco trade in the landmark year of 1981. That year, the state council (central government) – decided to introduce the to- bacco monopoly, incorporating China National To- bacco Corporation (CNTC) as the central agency to take charge of the industry on a unified basis. In January 1982, CNTC was officially incor- porated. However, without the existence of a spe- cialized central government agency in charge, it was impossible to realize a true state tobacco mo- nopoly. Therefore, in September 1983, the council issued its regulations on tobacco monopoly to of- ficially establish such a system and established the State Tobacco Monopoly Administration (STMA) on the basis of CNTC in January 1984. This made it possible for STMA to exercise unified, central- ized leadership and vertical management over the tobacco industry in terms of human resources, funding, assets, production, supply, marketing, and domestic and foreign trade. Although the monopoly was created, the change was not technically reflected in state legis- lation. Therefore, the Standing Committee of the National People's Congress (China's national leg- islature) enacted the Law of the People's Republic of China on Tobacco Monopoly in June 1991, offi- cially bringing the state tobacco monopoly system A production line in one of China's huge cigarette factories Getting to the bottom of the structure of China's tobacco industry is often difficult, but Tobacco Asia hopes to set everyone straight here not only on the structure, but on all the existing enterprises and their brands and strengths. The Tobacco Asia Profile

Articles in this issue

Archives of this issue

view archives of Tobacco Asia - Volume 19, Number 3