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A political economy of the tobacco supply chain in an Eastern Mediterranean country: The case of Lebanon

PMCID: PMC11957285

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Abstract

The literature on tobacco has traditionally focused on health effects, public policies for tobacco control, and smoker profiles. However, there is a notable gap in understanding the supply chains and industry practices within the tobacco market. This paper addresses this gap by examining the structure of the tobacco market in Lebanon. Using an exploratory qualitative research approach, this paper maps the tobacco supply chain in Lebanon and investigates the interactions among various stakeholders, including key policymakers, regulators, researchers, and industry experts, as well as their underlying interests. Lebanon is a compelling case study due to its high smoking prevalence, the presence of a state-owned tobacco monopoly (the Regie Libanaise de Tabacs et Tombacs (Regie)), and the ongoing financial crisis that has affected various sectors, including the tobacco industry. The findings reveal three key issues: a complex political economy centered around monopolization and conflicting interests, the absence of a clear national strategy on tobacco leading to ineffective policy formulation, and inefficient tobacco cultivation practices requiring reforms for sustainable agricultural development. To address these issues, it is proposed to foster a more competitive and revenue-efficient tobacco market through the dissolution of the Regie monopoly via horizontal and vertical integration. This includes adopting an excise-specific tax on domestically manufactured tobacco goods and optimizing sales taxes on locally traded items. Secondly, expanding antitrust laws to encompass the tobacco industry and introducing legislative measures for fees and taxes are recommended to create an enabling environment for competition and revenue generation. Thirdly, reforming tobacco cultivation practices requires abolishing the current cultivation licensing framework, offering financial compensation to existing license holders, and supporting farmers in transitioning to alternative crops.

Full Text

Every year, tobacco use leads to the deaths of more than 8 million people, among whom approximately 1.3 million are non-smokers who are exposed to second-hand smoking [1]. The health dangers linked to tobacco smoking are widely acknowledged, making it a major public health threat worldwide [1]. Despite its severe impacts, including the deaths of over 8 million people annually [1], its being a leading risk factor for diseases like cancer, cardiovascular issues, and respiratory illnesses [2], and its contribution to poverty by diverting spending away from essential needs towards tobacco purchases [1], tobacco use remains highly prevalent and continues to rise [3]. Moreover, the tobacco industry continues to be one of the most lucrative industries globally ([4,5]).
Growing concerns about the economic and health consequences of tobacco use have spurred many governments to enact tobacco control policies and strategies aimed at curbing its consumption. These measures encompass taxation, public awareness campaigns, the implementation of health warning labels, restrictions on smoking in public areas, bans on tobacco advertising and promotion, and the provision of smoking cessation programs. Among these, raising tobacco prices through increased taxes has been identified as the most effective policy approach for reducing tobacco smoking prevalence [6–12]. This is of particular importance in the Eastern Mediterranean Region (EMR), where tobacco products are priced the lowest and have the second-lowest average excise tax per pack compared to other World Health Organization regions [13].
As indicated by the World Health Organization (WHO) [1], taxes imposed on tobacco products represent the most cost-effective strategy for mitigating consumption and the associated economic and healthcare expenses. The primary mechanism through which taxes achieve this reduction is by raising tobacco prices. According to WHO estimates, a 10% rise in tobacco prices would lead to a roughly 4% decrease in demand in high-income countries and a 5% decline in low- to middle-income countries [1]. Consistent with these findings, Salti et al. (2015) [14] observes that a 10% increase in cigarette prices, specifically, would result in an average consumption reduction of 4–6% in high-income countries and 2–7% in low- and middle-income countries [14]. This holds particular significance in developing countries, where it is projected that tobacco will contribute to an estimated 10 million deaths annually by 2030 [15]. Tobacco taxation provides additional advantages, including revenue generation and addressing external costs associated with tobacco consumption, such as illnesses affecting non-smokers and the expenses incurred in treating these diseases [16].
Within the tobacco literature, there has been a substantial focus on analysing public policies associated with tobacco control, including evaluating their effectiveness and conducting cost-benefit analyses concerning smoking economics. However, far less attention has been dedicated to examining the political economy of tobacco supply chains and associated, tobacco industry practices, as important as such an understanding is to the design and implementation of effective taxation policies. Such research would map production practices, distribution networks, marketing strategies, and the influence of multinational tobacco companies on global, regional and national tobacco consumption patterns, and would be instrumental for identifying entry point for tobacco control policies, taxation included, not least in view the industry’s capacity to exert influence on policy-making bodies against implementing such measures [17]. The core question that this paper explores is how does the prevalent market structure impact the influence and relative power of the different stakeholders in the tobacco market.
Studying Lebanon is pertinent for many reasons. First, due to the high prevalence of smoking. Based on World Bank indicators, 38.2% of individuals aged 15 and above in Lebanon currently use tobacco products on a daily or non-daily basis (The World Bank, 2020). This percentage exceeds the Middle East and North Africa (MENA) regional average by 19% and the average of low- and middle-income countries (LMIC) by 15.1% [18]. Considering non-permanent smokers and occasional experimenters with various tobacco products, the overall tobacco use rate would rise to 70% [19]. Second, Lebanon is one of the few countries that operate a state-owned tobacco monopoly (SOTM) known as the Regie Libanaise de Tabacs et Tombacs, commonly referred to as the Regie. The Regie’s primary purpose is to generate revenue for the government through the manufacturing and sale of tobacco products. However, it shares many key features with Monopoly-Oriented Endgame Models (MOEM), which have been proposed as a potential approach to reduce smoking prevalence to below 5% within a specified timeframe [20]. In addition, we aim to further enhance our understanding of the tobacco industry’s supply chain in Lebanon and the operations of the Regie. Lastly, the tobacco industry remains one of the most important sectors operating in Lebanon and continues to generate profits despite Lebanon’s financial crisis.
Scholarly analysis of the tobacco industry in the Middle East remains limited, with no previous research focusing on the political economy of tobacco in Lebanon. However, some relevant papers shed light on this topic. Nakkash & Lee’s 2008 [21] study examines how British American Tobacco (BAT) and other transnational tobacco companies (TTCs) accessed the Lebanese market through smuggling and legal channels amidst political instability, emphasizing the need for international cooperation to address cigarette smuggling in Lebanon and the Middle East. Additionally, Chalak et al.’s 2023 [22] landscape report on tobacco consumption and taxation in Lebanon provides background information on Lebanon’s tobacco history and the supply and demand of tobacco products. Alaouie et al.’s 2022 [20] paper reviews tobacco endgame proposals, focusing on the Monopoly-Oriented Endgame Model (MOEM) and using the Regie in Lebanon as a case study to assess its alignment with MOEM features, highlighting key themes in governance and operational remit, and emphasizing the need for appropriate governance structures and financial incentives to suppress the expansion of the tobacco market. This study complements and add to this body of literature, by highlighting two significant issues: 1) the misalignment of policy objective between the monopole, with a profit maximizing objective, and the public policy makers who target several policy objectives, including maximizing of net public revenues, improvement of public health and environmental objectives; 2) the co-dependency between monopole and subsistence farming, by subsidizing and encouraging an inefficient system of substance farming, the monopole attain legitimacy as a social provider. Overall, this study offers a comprehensive picture of the complex relationships in the tobacco supply chain in Lebanon, which should serve as a chart for any feasible and efficient policymaking.
The structure of the tobacco supply chain in Lebanon is challenging to understand. As early as the 1930s, Tobacco transnational Corporations (TTCs) aimed for a significant presence in the Lebanese market when a French entity acquired the Ottoman Regie’s assets, forming the Compagnie Libano-Syrienne des Tabacs [21]. After the end of French rule in 1935, the control transitioned to the French company with Lebanese shareholders. This setup persisted until the 1950s, when the government reclaimed the Regie Libanaise des Tabacs et Tombacs (referred to as the Regie or RLTT), placing it under state ownership and the Ministry of Finance’s oversight in 1959 [21]. Although initially not designed to be permanent, discussions of a planned tender emerged in 1961, and periodic assessments of the Regie’s monopoly status ensued. Political instability and sectarian divisions within the country impeded resolutions. The legal standing of the Regie has remained uncertain up to the present day, with a significant challenge being the interconnection of the tobacco industry with influential groups that historically exchange favors with farmers and Regie employees for political support [21].
With respect to the tobacco supply, currently, approximately 80,000 dunams of land are dedicated to cultivating tobacco leaves, representing about 3.5% of the total arable land area. This cultivation yields an annual output of around 8,000 metric tons, with approximately 25,000 farmers across 458 villages involved in its production. Notably, 37% of these farmers are concentrated in the southern region of the country. However, alternative sources suggest a lower figure of 11,000 full-time tobacco farmers [22].
This study uses qualitative research methods to explore key stakeholders’ perspectives and experiences and understand the complexities and intricacies of the tobacco industry in Lebanon. Given the economic, social, cultural, and political factors influencing tobacco politics and supply chains, interviewing policymakers and researchers can reveal dynamics not captured by quantitative approaches. Additionally, qualitative findings can help provide insights into the motivations, challenges, and strategies of different key stakeholders in the tobacco industry which is crucial for planning targeted measures and nationally appropriate policies to regulate tobacco supply chains and reduce tobacco use [23].
According to Mathie and Camozzi (2005) [24], qualitative research is especially useful for “politically or socially sensitive topics”, such as the dynamics of tobacco production and products smuggling. Furthermore, qualitative methods have been widely used in tobacco-related research. Newly published research delves into the governmental strategies and perspectives on tobacco control and its alternatives in Malawi. It involved semi-structured interviews with stakeholders working in the tobacco sector [25]. Moreover, recent studies aimed to explore challenges facing tobacco control policies in Indonesia and Australia by conducting interviews with national tobacco control experts including academics, community organisations, and government officials ([26,27]). Similary, a study aiming to understand the dynamics of the waterpipe industry also utilized semi-structured interviews with representatives from various waterpipe companies [28]. In many studies, the use of qualitative methodology has been considered a strength given the richness of data that it provides regarding the tobacco industry especially when official documents that could shed light on the market dynamics are lacking.
The research team observed adequacy, credibility and reflexivity, which are the fundamental elements of trustworthiness in qualitative research. Regarding adequacy and dependability, the team conducted weekly discussions to ensure that data generation and analysis were appropriate for addressing the research questions. In terms of credibility, it was maintained through prolonged engagement with data, using transcriptions of audio-recorded interviews as a primary data source, and providing a summary of all main themes and sub-themes that emerged. In addition, to ensure researchers’ reflexivity, data collectors were sensitive to their interaction with participants and applied thoughtful self-reflection before and after interviews with stakeholders. The study’s reporting adhered to the guidelines outlined in the COnsolidated criteria for REporting Qualitative research (COREQ) checklist [29].
Data analysis has been conducted concurrently with ongoing data collection and adopted an inductive coding approach. This approach was used to extract themes from raw data, enabling the identification of emerging topics relevant to the research question and the discovery of new, unexpected themes without any preconceptions or guiding hypotheses [30]. The analysis was conducted manually using a thematic approach described by Braun and Clarke (2006) [31]. Thematic analysis is “a method for identifying, analysing, and interpreting patterns of meaning (‘themes’) within qualitative data” (Clarke & Braun, 2017 [32], p.297–298). It has been used since it is flexible and can be adapted to our research question and sample size. It is also systematic, generates rigorous analysis, and provides interpretive depth [32]. It consists of six phases, starting from the immersion in the data, generating initial codes by systematically coding across the data set, identifying common themes and grouping codes into themes, revising the themes and ensuring coherence, refining and naming the themes, until reaching the final step which includes embedding the themes in an analytic tale and writing the report. Findings and emergent themes were supported with quotes from individual interviews.
Based on an interview extract with a researcher involved in tobacco monopolies and taxation policies, it is estimated that 5 to 6 billion dollars were transferred to the treasury between 1990 and 2020. These numbers align with the data provided by the Regie in its financial overview, which is reported in Fig 1. This statement has been further supported by the Regie representative who stated that:
The Regie’s dominant position at the center of the tobacco industry in Lebanon allows it to generate large revenues. It is a bilateral monopoly, controlling the flow of products to downstream markets through its exclusive rights to produce and supply finished tobacco products. It also has significant market power on the upstream market, as the sole buyer of tobacco inputs (mostly tobacco leaves and other items used in tobacco products). According to official numbers published by the Regie, the total amount of revenues generated by the Regie between 1994 and 2021 is 4.177 billion USD, resulting in a net profit of 1.672 billion USD out of which 1.436 billion USD was transferred to the treasury. Fig 1 provides a diagram of the total sector revenues between 1994 and 2021 and their distribution across various components.
The behavior of the Regie is not fully monopolistic. More precisely, it does not fully take advantage of its dominant position on the upstream market to maximize profit; on the contrary, the Regie runs a subsidy program for tobacco farmers. The subsidy comes in the form of a negotiated price that is 60 to 100 percent higher than the global market price for tobacco leaves. The is inferred from interviews with both the Regie representative and the farmers union representative. Between 1994 and 2021, the subsidy cost was 1.032 billion USD, as reported in Fig 1.
Tobacco production is one of the major functions of the Regie. Their major brand—Cedars—had more than 50 percent of cigarette sales market share in 2019 [33].
Fig 2 presents an overview of the volume of tobacco cigarette imports and exports from 1961 to 2021, highlighting Lebanon’s nearly negligible imports of cigarettes.
22] based on FAO, 2022).
Tobacco farming has a long tradition in various areas of Lebanon. In the last five decades, it became concentrated in the South of Lebanon and the governorate of Akkar in the North of Lebanon. Tobacco cultivation in Lebanon started during the Ottoman era. The French mandate authorities (1918–1943) further encouraged tobacco farming and introduced several steps to organize the activity [34]. Most of these early regulations and organizational structures carried into the years of post-independence. In these earlier times, tobacco farming was subject to various forms of clientelist exploitation, but in the 1970s, a small farmers movement succeeded in weakening the control of large landowners over tobacco production. During the years of war and occupation of South Lebanon (1975–2000), tobacco took on a new meaning, becoming a “crop of resistance”, providing a source of sustenance for the impoverished population amidst ongoing violence [34].
To engage in tobacco farming, farmers must obtain a cultivation permit from the Regie. As explained by Hamade (2014) [35], this permit remains active only if the farmer produces more than 200 kilograms per year for not less than 2 years in a row. The locally produced crop is then bought by the Regie. Only 5% of Lebanese raw tobacco is used in the local tobacco production, the remainder is exported:
Fig 3 illustrates the import and export value of unmanufactured tobacco, confirming that the majority of domestically produced tobacco leaves are exported, with almost none being imported.
22] based on data from WITS, 2022 [36]).
Nowadays, it is estimated that an area covering 80 km2 is dedicated to cultivating tobacco leaves in Lebanon, constituting approximately 3.5% of the total cultivated land. As per the official data released by the Regie, the annual aggregate production amounts to approximately 8,000 metric tons, cultivated by roughly 25,000 farmers in 458 villages. A significant portion, 37%, is concentrated in South Lebanon, contributing to nearly 57% of the overall output [37].
As shown in Fig 4, as of 2022, the Regie Libanaise de Tabacs et Tombacs (Regie) held a market share of more than 55% in the tobacco industry, up from 45% in 2017. The leading transnational tobacco company (TTC) in Lebanon was Philip Morris International (PMI), with a market share of nearly 15%. Following PMI were Japan Tobacco International (JTI) with over 11%, Imperial Brands with almost 10%, and British American Tobacco (BAT) with 6.5%.
30] based on Euromonitor International, company shares 2017—2022, published May 2023).
In Lebanon, tobacco distribution and wholesale operate within a structured framework overseen by the Regie and are subject to specific regulations. As explained by the Regie and by government representatives, the distribution network involves a hierarchy with heads of sales for each region, particularly in Beirut and its suburbs, where around 20 to 25 heads of sales manage the distribution process. A total of 668 retail and wholesale groups are authorized to distribute tobacco products at both retail and wholesale levels throughout Lebanon. Exclusive licenses to sell tobacco products are granted for a fee to these groups, and consequently, the distribution process primarily involves direct delivery of tobacco to sellers through Regie’s stores, with retail sellers playing a central role [38]. Importantly, as highlighted by a governmental representative, private companies are restricted from directly importing tobacco and tombac into Lebanon without RLTT’s approval. To initiate such imports, companies must submit a request to RLTT, specifying the brand, manufacturing details, and a financial study outlining costs and potential market prices.
Lebanon, as a signatory to the WHO Framework Convention on Tobacco Control (FCTC), has been actively engaged in international efforts to curtail tobacco use globally. Notably, significant strides were made in tobacco control with the passage of Law No. 174 in August 2011, marking Lebanon’s first tobacco control legislation [39]. It introduced comprehensive measures, including the prohibition of smoking in all indoor public spaces, a ban on tobacco advertising, promotion, and sponsorship, and the introduction of larger text warnings on tobacco products, with the potential for graphic health warnings in the future. It must be noted that in the past few years, lobbying by the tobacco industry has hindered the implementation of graphic health warnings. Additionally, Law 394 addressed warnings about the hazards of smoking. One of the interviewees from civil society, who was involved in the effort to introduce this law, noted that more than a decade after its passage, there has been a noticeable regression in its implementation, particularly regarding the enforcement of smoking bans in closed public spaces. Nonetheless, the interviewee noted that, despite this setback, there are some lasting effects of Law No. 174, most notably the ban on advertisements.
Illicit trafficking of goods between Lebanon and Syria has existed since the establishment of the countries as independent nation states in the mid-1940s [40]. As reported by [21], the period of civil war witnessed a significant rise in tobacco smuggling, attributed to a local production decrease and inadequate state control over customs, leading to the influx of affordable contraband into the markets. Transnational Tobacco Companies (TTCs) took advantage of the chaos of the civil war to expand their market presence and supply tobacco to Lebanon or, in turn, facilitate distribution to neighboring countries like Syria, Jordan, and Turkey [21].
The direction of smuggling has often fluctuated based on comparative political and economic stability in Lebanon and Syria. Alaouie et al. (2022) [20] note the use of Lebanon as a gateway by TTCs for both legal and illegal trade of tobacco products in nearby nations. In earlier years, tobacco smuggling was more common from Syria to Lebanon due to difference in exchange rate [40,41]. There is a common agreement among most of the interviewees that in recent years, due to the war in Syria, the direction of smuggling inverted, with large quantities of tobacco products being smuggled from Lebanon to Syria:
Tobacco smuggling from Lebanon to other countries, particularly Syria, presents a complex interplay of economic factors and regulatory challenges. According to the 2023 Global Organized Crime Index for Lebanon, as reported by the Global Initiative Against Transnational Organized Crime, the illicit tobacco trade makes up approximately one-fourth of the entire tobacco market. Lebanon, known for its affordable tobacco products, becomes a focal point for illicit trade, with the smuggling route traversing through Turkey and Syria. Interestingly, it is believed by many of the stakeholders and researchers that were interviewed in this study that the Regie is well aware of the smuggling activities occurring beyond the country’s borders. Contrary to expectations, the RLTT does not actively intervene or halt these operations. According to an interviewed researcher, the RLTT’s decision to allow smuggling is strategic, as it serves as a significant source of revenue, which, in turn, contributes to sustaining their production activities. According to the information available on their official website, the Regie claims to be actively engaged in anti-smuggling operations. This involves market monitoring, combating the smuggling of tobacco and tombac throughout Lebanon, conducting raids on factories producing counterfeit tobacco products, and inspecting stores selling forged or smuggled items [42]. RLTT also oversees the free zone at Beirut port, ensuring the secure unloading and transportation of tobacco fabricated in the free zone to destinations like the airport or other ports [42].
It has been expected for the issue of tobacco taxation to add another layer to the situation’s complexity. Researchers highlighted that, historically, when advocates pushed for increased tobacco taxes to curb youth consumption and overall tobacco use, the RLTT, MOF and customs authorities argued against it. Their primary concern was that higher taxes would lead to an escalation in smuggling activities, particularly from Syria. This has been the main argument for many tobacco industries and tax opponents in other countries. While it is commonly acknowledged that the potential for tobacco smuggling can constrain the implementation of higher tobacco tax rates, entities opposing increases in tobacco taxes often tend to exaggerate both the extent and the risks associated with smuggling [16]. Estimates indicate that the increase in smuggling due to higher taxation is marginal and often overstated.
The central role of the Regie as a state-owned monopoly in the tobacco industry leads to conflict with potential key public policy objectives. This is evident when it comes to the tension between maximizing Regie’s revenues from tobacco sales in the local market and implementing an optimal tax policy. What constitutes an optimal tobacco tax policy objective could be subject to further discussion. Nonetheless, it is evident from discussions that revenues to the treasury and reduction of health costs associated with tobacco consumption should be key determinants of the policy ([43,44]).
The view that the Regie’s distribution of dividends to the Ministry of Finance resolves this conflict is not accurate. As discussed above, the Regie allocates a significant amount of revenue at the discretion of its independent management, with limited intervention from any public body, including the Ministry of Finance. This discretionary spending is not necessarily coordinated with public objectives set by the Ministry of Finance or the government more broadly. A second source of this contradiction stems from the Regie de facto operating as a supplier of tobacco (mostly cigarettes) to a larger regional market, not just the Lebanese market. This is particularly evident given indications of significant smuggling activity toward Syria and the Regie’s increased cigarette production in recent years, which may suggest a response to this market demand. Licensing deals agreed upon with the big tobacco companies to produce international brands in Lebanon, seems to be partially motivated by this unofficial market expansion. The low tobacco tax rate policy currently adopted in Lebanon increases the competitiveness of Regie-produced cigarettes in regional markets [45].
In addressing the challenges within the tobacco industry, several key policy recommendations emerge. Firstly, restructuring the industry is paramount, necessitating the liberalization of the sector and the dissolution of the Regie monopoly and monopsony through horizontal and vertical integration. Secondly, implementing an excise-specific tax on domestically manufactured tobacco goods is crucial, with the proceeds directed entirely to the government’s treasury [46]. Lastly, optimizing ad valorem and other sales taxes on locally traded tobacco items in alignment with market dynamics is essential to maximize revenue generation for the treasury [47]. These recommendations collectively aim to foster a more competitive and revenue-efficient tobacco market while ensuring effective government oversight and fiscal gains.
To address these issues, several key policy recommendations are proposed. Firstly, it is suggested to expand the existing antitrust law to encompass the tobacco industry, with specific amendments aimed at ensuring fair competition once the industry undergoes liberalization. Additionally, legislative measures should be enacted to allow for earmarked taxes and fees on tobacco products ([48,49]).
The evidence demonstrates that tobacco cultivation in Lebanon is inefficient. The prospect that this practice will become economically sustainable in the future is doubtful, an opinion shared by most interviewed experts, including the tobacco farmers union member. Therefore, from an economic efficiency perspective, there is no rationale for the tobacco cultivation subsidy program. Nonetheless, the subsidy and the community development programs funded by the Regie in tobacco producing districts constitute a substantive transfer with many beneficiaries. As noted in the discussion on tobacco farming, tobacco cultivation is a family practice relying on the participation of most family members. These families are often low-income families, for whom tobacco cultivation is a part-time, seasonal, occupation that brings in some needed additional income and cash flow. Moreover, the two governorates with the bulk of tobacco cultivation, Akkar and Nabatieh, have the highest rates of poverty in the country [50]. Any changes to the current tobacco industry structure could have a significant negative impact on these farmers, making such proposals politically undesirable. As such, any reform should take into consideration a form of compensation for the current tobacco farming license holders. It should be noted that several of the challenges facing tobacco farmers are common to the general agricultural sector in Lebanon. Encouraging alternative crops is a policy often discussed and promoted by experts and policy makers, however, several recent experiences have seen limited success.
Beyond Lebanon’s borders, this study’s findings and policy recommendations hold relevance for similar settings globally, especially within the Eastern Mediterranean region, where WHO projections indicate a worrying rise in smoking prevalence [13]. The innovative use of an exploratory qualitative approach not only fills a significant gap in the literature regarding the political economy of tobacco but also sheds light on crucial issues such as monopolization, the absence of a national tobacco strategy, and inefficient cultivation practices. These insights are not only actionable for policymakers in Lebanon but also serve as a blueprint for crafting effective tobacco control policies in other countries facing similar challenges. Thus, this research serves as basis for guiding efforts to combat smoking and its associated socioeconomic impacts on a broader scale.
Future research should triangulate qualitative data with updated quantitative data to assess the impact of policy changes. This includes updated estimates of demand elasticities, tax simulation exercises, impact on revenues to the public treasury, distributional impact of the tax, and impact on prevalence [51].

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"[{\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref001\", \"pone.0320050.ref001\", \"pone.0320050.ref001\", \"pone.0320050.ref002\", \"pone.0320050.ref001\", \"pone.0320050.ref003\", \"pone.0320050.ref004\", \"pone.0320050.ref005\"], \"section\": \"Introduction\", \"text\": \"Every year, tobacco use leads to the deaths of more than 8 million people, among whom approximately 1.3 million are non-smokers who are exposed to second-hand smoking [1]. The health dangers linked to tobacco smoking are widely acknowledged, making it a major public health threat worldwide [1]. Despite its severe impacts, including the deaths of over 8 million people annually [1], its being a leading risk factor for diseases like cancer, cardiovascular issues, and respiratory illnesses [2], and its contribution to poverty by diverting spending away from essential needs towards tobacco purchases [1], tobacco use remains highly prevalent and continues to rise [3]. Moreover, the tobacco industry continues to be one of the most lucrative industries globally ([4,5]).\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref006\", \"pone.0320050.ref012\", \"pone.0320050.ref013\"], \"section\": \"Introduction\", \"text\": \"Growing concerns about the economic and health consequences of tobacco use have spurred many governments to enact tobacco control policies and strategies aimed at curbing its consumption. These measures encompass taxation, public awareness campaigns, the implementation of health warning labels, restrictions on smoking in public areas, bans on tobacco advertising and promotion, and the provision of smoking cessation programs. Among these, raising tobacco prices through increased taxes has been identified as the most effective policy approach for reducing tobacco smoking prevalence [6\\u201312]. This is of particular importance in the Eastern Mediterranean Region (EMR), where tobacco products are priced the lowest and have the second-lowest average excise tax per pack compared to other World Health Organization regions [13].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref001\", \"pone.0320050.ref001\", \"pone.0320050.ref014\", \"pone.0320050.ref014\", \"pone.0320050.ref015\", \"pone.0320050.ref016\"], \"section\": \"Introduction\", \"text\": \"As indicated by the World Health Organization (WHO) [1], taxes imposed on tobacco products represent the most cost-effective strategy for mitigating consumption and the associated economic and healthcare expenses. The primary mechanism through which taxes achieve this reduction is by raising tobacco prices. According to WHO estimates, a 10% rise in tobacco prices would lead to a roughly 4% decrease in demand in high-income countries and a 5% decline in low- to middle-income countries [1]. Consistent with these findings, Salti et al. (2015) [14] observes that a 10% increase in cigarette prices, specifically, would result in an average consumption reduction of 4\\u20136% in high-income countries and 2\\u20137% in low- and middle-income countries [14]. This holds particular significance in developing countries, where it is projected that tobacco will contribute to an estimated 10 million deaths annually by 2030 [15]. Tobacco taxation provides additional advantages, including revenue generation and addressing external costs associated with tobacco consumption, such as illnesses affecting non-smokers and the expenses incurred in treating these diseases [16].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref017\"], \"section\": \"Introduction\", \"text\": \"Within the tobacco literature, there has been a substantial focus on analysing public policies associated with tobacco control, including evaluating their effectiveness and conducting cost-benefit analyses concerning smoking economics. However, far less attention has been dedicated to examining the political economy of tobacco supply chains and associated, tobacco industry practices, as important as such an understanding is to the design and implementation of effective taxation policies. Such research would map production practices, distribution networks, marketing strategies, and the influence of multinational tobacco companies on global, regional and national tobacco consumption patterns, and would be instrumental for identifying entry point for tobacco control policies, taxation included, not least in view the industry\\u2019s capacity to exert influence on policy-making bodies against implementing such measures [17]. The core question that this paper explores is how does the prevalent market structure impact the influence and relative power of the different stakeholders in the tobacco market.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref018\", \"pone.0320050.ref019\", \"pone.0320050.ref020\"], \"section\": \"Introduction\", \"text\": \"Studying Lebanon is pertinent for many reasons. First, due to the high prevalence of smoking. Based on World Bank indicators, 38.2% of individuals aged 15 and above in Lebanon currently use tobacco products on a daily or non-daily basis (The World Bank, 2020). This percentage exceeds the Middle East and North Africa (MENA) regional average by 19% and the average of low- and middle-income countries (LMIC) by 15.1% [18]. Considering non-permanent smokers and occasional experimenters with various tobacco products, the overall tobacco use rate would rise to 70% [19]. Second, Lebanon is one of the few countries that operate a state-owned tobacco monopoly (SOTM) known as the Regie Libanaise de Tabacs et Tombacs, commonly referred to as the Regie. The Regie\\u2019s primary purpose is to generate revenue for the government through the manufacturing and sale of tobacco products. However, it shares many key features with Monopoly-Oriented Endgame Models (MOEM), which have been proposed as a potential approach to reduce smoking prevalence to below 5% within a specified timeframe [20]. In addition, we aim to further enhance our understanding of the tobacco industry\\u2019s supply chain in Lebanon and the operations of the Regie. Lastly, the tobacco industry remains one of the most important sectors operating in Lebanon and continues to generate profits despite Lebanon\\u2019s financial crisis.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref021\", \"pone.0320050.ref022\", \"pone.0320050.ref020\"], \"section\": \"Introduction\", \"text\": \"Scholarly analysis of the tobacco industry in the Middle East remains limited, with no previous research focusing on the political economy of tobacco in Lebanon. However, some relevant papers shed light on this topic. Nakkash & Lee\\u2019s 2008 [21] study examines how British American Tobacco (BAT) and other transnational tobacco companies (TTCs) accessed the Lebanese market through smuggling and legal channels amidst political instability, emphasizing the need for international cooperation to address cigarette smuggling in Lebanon and the Middle East. Additionally, Chalak et al.\\u2019s 2023 [22] landscape report on tobacco consumption and taxation in Lebanon provides background information on Lebanon\\u2019s tobacco history and the supply and demand of tobacco products. Alaouie et al.\\u2019s 2022 [20] paper reviews tobacco endgame proposals, focusing on the Monopoly-Oriented Endgame Model (MOEM) and using the Regie in Lebanon as a case study to assess its alignment with MOEM features, highlighting key themes in governance and operational remit, and emphasizing the need for appropriate governance structures and financial incentives to suppress the expansion of the tobacco market. This study complements and add to this body of literature, by highlighting two significant issues: 1) the misalignment of policy objective between the monopole, with a profit maximizing objective, and the public policy makers who target several policy objectives, including maximizing of net public revenues, improvement of public health and environmental objectives; 2) the co-dependency between monopole and subsistence farming, by subsidizing and encouraging an inefficient system of substance farming, the monopole attain legitimacy as a social provider. Overall, this study offers a comprehensive picture of the complex relationships in the tobacco supply chain in Lebanon, which should serve as a chart for any feasible and efficient policymaking.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref021\", \"pone.0320050.ref021\", \"pone.0320050.ref021\"], \"section\": \"Background\", \"text\": \"The structure of the tobacco supply chain in Lebanon is challenging to understand. As early as the 1930s, Tobacco transnational Corporations (TTCs) aimed for a significant presence in the Lebanese market when a French entity acquired the Ottoman Regie\\u2019s assets, forming the Compagnie Libano-Syrienne des Tabacs [21]. After the end of French rule in 1935, the control transitioned to the French company with Lebanese shareholders. This setup persisted until the 1950s, when the government reclaimed the Regie Libanaise des Tabacs et Tombacs (referred to as the Regie or RLTT), placing it under state ownership and the Ministry of Finance\\u2019s oversight in 1959 [21]. Although initially not designed to be permanent, discussions of a planned tender emerged in 1961, and periodic assessments of the Regie\\u2019s monopoly status ensued. Political instability and sectarian divisions within the country impeded resolutions. The legal standing of the Regie has remained uncertain up to the present day, with a significant challenge being the interconnection of the tobacco industry with influential groups that historically exchange favors with farmers and Regie employees for political support [21].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref022\"], \"section\": \"Background\", \"text\": \"With respect to the tobacco supply, currently, approximately 80,000 dunams of land are dedicated to cultivating tobacco leaves, representing about 3.5% of the total arable land area. This cultivation yields an annual output of around 8,000 metric tons, with approximately 25,000 farmers across 458 villages involved in its production. Notably, 37% of these farmers are concentrated in the southern region of the country. However, alternative sources suggest a lower figure of 11,000 full-time tobacco farmers [22].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref023\"], \"section\": \"Study design\", \"text\": \"This study uses qualitative research methods to explore key stakeholders\\u2019 perspectives and experiences and understand the complexities and intricacies of the tobacco industry in Lebanon. Given the economic, social, cultural, and political factors influencing tobacco politics and supply chains, interviewing policymakers and researchers can reveal dynamics not captured by quantitative approaches. Additionally, qualitative findings can help provide insights into the motivations, challenges, and strategies of different key stakeholders in the tobacco industry which is crucial for planning targeted measures and nationally appropriate policies to regulate tobacco supply chains and reduce tobacco use [23].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref024\", \"pone.0320050.ref025\", \"pone.0320050.ref026\", \"pone.0320050.ref027\", \"pone.0320050.ref028\"], \"section\": \"Study design\", \"text\": \"According to Mathie and Camozzi (2005) [24], qualitative research is especially useful for \\u201cpolitically or socially sensitive topics\\u201d, such as the dynamics of tobacco production and products smuggling. Furthermore, qualitative methods have been widely used in tobacco-related research. Newly published research delves into the governmental strategies and perspectives on tobacco control and its alternatives in Malawi. It involved semi-structured interviews with stakeholders working in the tobacco sector [25]. Moreover, recent studies aimed to explore challenges facing tobacco control policies in Indonesia and Australia by conducting interviews with national tobacco control experts including academics, community organisations, and government officials ([26,27]). Similary, a study aiming to understand the dynamics of the waterpipe industry also utilized semi-structured interviews with representatives from various waterpipe companies [28]. In many studies, the use of qualitative methodology has been considered a strength given the richness of data that it provides regarding the tobacco industry especially when official documents that could shed light on the market dynamics are lacking.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref029\"], \"section\": \"Recruitment and data collection\", \"text\": \"The research team observed adequacy, credibility and reflexivity, which are the fundamental elements of trustworthiness in qualitative research. Regarding adequacy and dependability, the team conducted weekly discussions to ensure that data generation and analysis were appropriate for addressing the research questions. In terms of credibility, it was maintained through prolonged engagement with data, using transcriptions of audio-recorded interviews as a primary data source, and providing a summary of all main themes and sub-themes that emerged. In addition, to ensure researchers\\u2019 reflexivity, data collectors were sensitive to their interaction with participants and applied thoughtful self-reflection before and after interviews with stakeholders. The study\\u2019s reporting adhered to the guidelines outlined in the COnsolidated criteria for REporting Qualitative research (COREQ) checklist [29].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref030\", \"pone.0320050.ref031\", \"pone.0320050.ref032\", \"pone.0320050.ref032\"], \"section\": \"Data management and analysis\", \"text\": \"Data analysis has been conducted concurrently with ongoing data collection and adopted an inductive coding approach. This approach was used to extract themes from raw data, enabling the identification of emerging topics relevant to the research question and the discovery of new, unexpected themes without any preconceptions or guiding hypotheses [30]. The analysis was conducted manually using a thematic approach described by Braun and Clarke (2006) [31]. Thematic analysis is \\u201ca method for identifying, analysing, and interpreting patterns of meaning (\\u2018themes\\u2019) within qualitative data\\u201d (Clarke & Braun, 2017 [32], p.297\\u2013298). It has been used since it is flexible and can be adapted to our research question and sample size. It is also systematic, generates rigorous analysis, and provides interpretive depth [32]. It consists of six phases, starting from the immersion in the data, generating initial codes by systematically coding across the data set, identifying common themes and grouping codes into themes, revising the themes and ensuring coherence, refining and naming the themes, until reaching the final step which includes embedding the themes in an analytic tale and writing the report. Findings and emergent themes were supported with quotes from individual interviews.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.g001\"], \"section\": \"The Regie: A bilateral monopoly\", \"text\": \"Based on an interview extract with a researcher involved in tobacco monopolies and taxation policies, it is estimated that 5 to 6 billion dollars were transferred to the treasury between 1990 and 2020. These numbers align with the data provided by the Regie in its financial overview, which is reported in Fig 1. This statement has been further supported by the Regie representative who stated that:\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.g001\"], \"section\": \"The Regie: A bilateral monopoly\", \"text\": \"The Regie\\u2019s dominant position at the center of the tobacco industry in Lebanon allows it to generate large revenues. It is a bilateral monopoly, controlling the flow of products to downstream markets through its exclusive rights to produce and supply finished tobacco products. It also has significant market power on the upstream market, as the sole buyer of tobacco inputs (mostly tobacco leaves and other items used in tobacco products). According to official numbers published by the Regie, the total amount of revenues generated by the Regie between 1994 and 2021 is 4.177 billion USD, resulting in a net profit of 1.672 billion USD out of which 1.436 billion USD was transferred to the treasury. Fig 1 provides a diagram of the total sector revenues between 1994 and 2021 and their distribution across various components.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.g001\"], \"section\": \"The Regie: A bilateral monopoly\", \"text\": \"The behavior of the Regie is not fully monopolistic. More precisely, it does not fully take advantage of its dominant position on the upstream market to maximize profit; on the contrary, the Regie runs a subsidy program for tobacco farmers. The subsidy comes in the form of a negotiated price that is 60 to 100 percent higher than the global market price for tobacco leaves. The is inferred from interviews with both the Regie representative and the farmers union representative. Between 1994 and 2021, the subsidy cost was 1.032 billion USD, as reported in Fig 1.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref033\"], \"section\": \"The Regie: A bilateral monopoly\", \"text\": \"Tobacco production is one of the major functions of the Regie. Their major brand\\u2014Cedars\\u2014had more than 50 percent of cigarette sales market share in 2019 [33].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.g002\"], \"section\": \"The Regie: A bilateral monopoly\", \"text\": \"Fig 2 presents an overview of the volume of tobacco cigarette imports and exports from 1961 to 2021, highlighting Lebanon\\u2019s nearly negligible imports of cigarettes.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref022\"], \"section\": \"Tobacco cigarettes imports and exports volume (Adapted from [\", \"text\": \"22] based on FAO, 2022).\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref034\", \"pone.0320050.ref034\"], \"section\": \"Tobacco farming: Challenges and dynamics\", \"text\": \"Tobacco farming has a long tradition in various areas of Lebanon. In the last five decades, it became concentrated in the South of Lebanon and the governorate of Akkar in the North of Lebanon. Tobacco cultivation in Lebanon started during the Ottoman era. The French mandate authorities (1918\\u20131943) further encouraged tobacco farming and introduced several steps to organize the activity [34]. Most of these early regulations and organizational structures carried into the years of post-independence. In these earlier times, tobacco farming was subject to various forms of clientelist exploitation, but in the 1970s, a small farmers movement succeeded in weakening the control of large landowners over tobacco production. During the years of war and occupation of South Lebanon (1975\\u20132000), tobacco took on a new meaning, becoming a \\u201ccrop of resistance\\u201d, providing a source of sustenance for the impoverished population amidst ongoing violence [34].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref035\"], \"section\": \"Tobacco farming: Challenges and dynamics\", \"text\": \"To engage in tobacco farming, farmers must obtain a cultivation permit from the Regie. As explained by Hamade (2014) [35], this permit remains active only if the farmer produces more than 200 kilograms per year for not less than 2 years in a row. The locally produced crop is then bought by the Regie. Only 5% of Lebanese raw tobacco is used in the local tobacco production, the remainder is exported:\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.g003\"], \"section\": \"Tobacco farming: Challenges and dynamics\", \"text\": \"Fig 3 illustrates the import and export value of unmanufactured tobacco, confirming that the majority of domestically produced tobacco leaves are exported, with almost none being imported.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref022\", \"pone.0320050.ref036\"], \"section\": \"Import and export value of unmanufactured tobacco (Adapted from [\", \"text\": \"22] based on data from WITS, 2022 [36]).\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref037\"], \"section\": \"Tobacco farming: Challenges and dynamics\", \"text\": \"Nowadays, it is estimated that an area covering 80 km2 is dedicated to cultivating tobacco leaves in Lebanon, constituting approximately 3.5% of the total cultivated land. As per the official data released by the Regie, the annual aggregate production amounts to approximately 8,000 metric tons, cultivated by roughly 25,000 farmers in 458 villages. A significant portion, 37%, is concentrated in South Lebanon, contributing to nearly 57% of the overall output [37].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.g004\"], \"section\": \"Big tobacco companies\", \"text\": \"As shown in Fig 4, as of 2022, the Regie Libanaise de Tabacs et Tombacs (Regie) held a market share of more than 55% in the tobacco industry, up from 45% in 2017. The leading transnational tobacco company (TTC) in Lebanon was Philip Morris International (PMI), with a market share of nearly 15%. Following PMI were Japan Tobacco International (JTI) with over 11%, Imperial Brands with almost 10%, and British American Tobacco (BAT) with 6.5%.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref030\"], \"section\": \"Market share and leading brands (from Lebanon country profile, 2023 [\", \"text\": \"30] based on Euromonitor International, company shares 2017\\u20142022, published May 2023).\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref038\"], \"section\": \"Distribution and wholesale\", \"text\": \"In Lebanon, tobacco distribution and wholesale operate within a structured framework overseen by the Regie and are subject to specific regulations. As explained by the Regie and by government representatives, the distribution network involves a hierarchy with heads of sales for each region, particularly in Beirut and its suburbs, where around 20 to 25 heads of sales manage the distribution process. A total of 668 retail and wholesale groups are authorized to distribute tobacco products at both retail and wholesale levels throughout Lebanon. Exclusive licenses to sell tobacco products are granted for a fee to these groups, and consequently, the distribution process primarily involves direct delivery of tobacco to sellers through Regie\\u2019s stores, with retail sellers playing a central role [38]. Importantly, as highlighted by a governmental representative, private companies are restricted from directly importing tobacco and tombac into Lebanon without RLTT\\u2019s approval. To initiate such imports, companies must submit a request to RLTT, specifying the brand, manufacturing details, and a financial study outlining costs and potential market prices.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref039\"], \"section\": \"Public oversight and public policy\", \"text\": \"Lebanon, as a signatory to the WHO Framework Convention on Tobacco Control (FCTC), has been actively engaged in international efforts to curtail tobacco use globally. Notably, significant strides were made in tobacco control with the passage of Law No. 174 in August 2011, marking Lebanon\\u2019s first tobacco control legislation [39]. It introduced comprehensive measures, including the prohibition of smoking in all indoor public spaces, a ban on tobacco advertising, promotion, and sponsorship, and the introduction of larger text warnings on tobacco products, with the potential for graphic health warnings in the future. It must be noted that in the past few years, lobbying by the tobacco industry has hindered the implementation of graphic health warnings. Additionally, Law 394 addressed warnings about the hazards of smoking. One of the interviewees from civil society, who was involved in the effort to introduce this law, noted that more than a decade after its passage, there has been a noticeable regression in its implementation, particularly regarding the enforcement of smoking bans in closed public spaces. Nonetheless, the interviewee noted that, despite this setback, there are some lasting effects of Law No. 174, most notably the ban on advertisements.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref040\", \"pone.0320050.ref021\", \"pone.0320050.ref021\"], \"section\": \"Permeability of Lebanon-Syria borders\", \"text\": \"Illicit trafficking of goods between Lebanon and Syria has existed since the establishment of the countries as independent nation states in the mid-1940s [40]. As reported by [21], the period of civil war witnessed a significant rise in tobacco smuggling, attributed to a local production decrease and inadequate state control over customs, leading to the influx of affordable contraband into the markets. Transnational Tobacco Companies (TTCs) took advantage of the chaos of the civil war to expand their market presence and supply tobacco to Lebanon or, in turn, facilitate distribution to neighboring countries like Syria, Jordan, and Turkey [21].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref020\", \"pone.0320050.ref040\", \"pone.0320050.ref041\"], \"section\": \"Permeability of Lebanon-Syria borders\", \"text\": \"The direction of smuggling has often fluctuated based on comparative political and economic stability in Lebanon and Syria. Alaouie et al. (2022) [20] note the use of Lebanon as a gateway by TTCs for both legal and illegal trade of tobacco products in nearby nations. In earlier years, tobacco smuggling was more common from Syria to Lebanon due to difference in exchange rate [40,41]. There is a common agreement among most of the interviewees that in recent years, due to the war in Syria, the direction of smuggling inverted, with large quantities of tobacco products being smuggled from Lebanon to Syria:\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref042\", \"pone.0320050.ref042\"], \"section\": \"Permeability of Lebanon-Syria borders\", \"text\": \"Tobacco smuggling from Lebanon to other countries, particularly Syria, presents a complex interplay of economic factors and regulatory challenges. According to the 2023 Global Organized Crime Index for Lebanon, as reported by the Global Initiative Against Transnational Organized Crime, the illicit tobacco trade makes up approximately one-fourth of the entire tobacco market. Lebanon, known for its affordable tobacco products, becomes a focal point for illicit trade, with the smuggling route traversing through Turkey and Syria. Interestingly, it is believed by many of the stakeholders and researchers that were interviewed in this study that the Regie is well aware of the smuggling activities occurring beyond the country\\u2019s borders. Contrary to expectations, the RLTT does not actively intervene or halt these operations. According to an interviewed researcher, the RLTT\\u2019s decision to allow smuggling is strategic, as it serves as a significant source of revenue, which, in turn, contributes to sustaining their production activities. According to the information available on their official website, the Regie claims to be actively engaged in anti-smuggling operations. This involves market monitoring, combating the smuggling of tobacco and tombac throughout Lebanon, conducting raids on factories producing counterfeit tobacco products, and inspecting stores selling forged or smuggled items [42]. RLTT also oversees the free zone at Beirut port, ensuring the secure unloading and transportation of tobacco fabricated in the free zone to destinations like the airport or other ports [42].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref016\"], \"section\": \"Permeability of Lebanon-Syria borders\", \"text\": \"It has been expected for the issue of tobacco taxation to add another layer to the situation\\u2019s complexity. Researchers highlighted that, historically, when advocates pushed for increased tobacco taxes to curb youth consumption and overall tobacco use, the RLTT, MOF and customs authorities argued against it. Their primary concern was that higher taxes would lead to an escalation in smuggling activities, particularly from Syria. This has been the main argument for many tobacco industries and tax opponents in other countries. While it is commonly acknowledged that the potential for tobacco smuggling can constrain the implementation of higher tobacco tax rates, entities opposing increases in tobacco taxes often tend to exaggerate both the extent and the risks associated with smuggling [16]. Estimates indicate that the increase in smuggling due to higher taxation is marginal and often overstated.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref043\", \"pone.0320050.ref044\"], \"section\": \"Central role of the Regie as a state-owned monopoly\", \"text\": \"The central role of the Regie as a state-owned monopoly in the tobacco industry leads to conflict with potential key public policy objectives. This is evident when it comes to the tension between maximizing Regie\\u2019s revenues from tobacco sales in the local market and implementing an optimal tax policy. What constitutes an optimal tobacco tax policy objective could be subject to further discussion. Nonetheless, it is evident from discussions that revenues to the treasury and reduction of health costs associated with tobacco consumption should be key determinants of the policy ([43,44]).\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref045\"], \"section\": \"Central role of the Regie as a state-owned monopoly\", \"text\": \"The view that the Regie\\u2019s distribution of dividends to the Ministry of Finance resolves this conflict is not accurate. As discussed above, the Regie allocates a significant amount of revenue at the discretion of its independent management, with limited intervention from any public body, including the Ministry of Finance. This discretionary spending is not necessarily coordinated with public objectives set by the Ministry of Finance or the government more broadly. A second source of this contradiction stems from the Regie de facto operating as a supplier of tobacco (mostly cigarettes) to a larger regional market, not just the Lebanese market. This is particularly evident given indications of significant smuggling activity toward Syria and the Regie\\u2019s increased cigarette production in recent years, which may suggest a response to this market demand. Licensing deals agreed upon with the big tobacco companies to produce international brands in Lebanon, seems to be partially motivated by this unofficial market expansion. The low tobacco tax rate policy currently adopted in Lebanon increases the competitiveness of Regie-produced cigarettes in regional markets [45].\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref046\", \"pone.0320050.ref047\"], \"section\": \"Central role of the Regie as a state-owned monopoly\", \"text\": \"In addressing the challenges within the tobacco industry, several key policy recommendations emerge. Firstly, restructuring the industry is paramount, necessitating the liberalization of the sector and the dissolution of the Regie monopoly and monopsony through horizontal and vertical integration. Secondly, implementing an excise-specific tax on domestically manufactured tobacco goods is crucial, with the proceeds directed entirely to the government\\u2019s treasury [46]. Lastly, optimizing ad valorem and other sales taxes on locally traded tobacco items in alignment with market dynamics is essential to maximize revenue generation for the treasury [47]. These recommendations collectively aim to foster a more competitive and revenue-efficient tobacco market while ensuring effective government oversight and fiscal gains.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref048\", \"pone.0320050.ref049\"], \"section\": \"There is no clear national strategy on tobacco that translates into actionable public policy\", \"text\": \"To address these issues, several key policy recommendations are proposed. Firstly, it is suggested to expand the existing antitrust law to encompass the tobacco industry, with specific amendments aimed at ensuring fair competition once the industry undergoes liberalization. Additionally, legislative measures should be enacted to allow for earmarked taxes and fees on tobacco products ([48,49]).\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref050\"], \"section\": \"Tobacco farmers\\u2019 interest and economic survival is a key component of any reform of the tobacco industry\", \"text\": \"The evidence demonstrates that tobacco cultivation in Lebanon is inefficient. The prospect that this practice will become economically sustainable in the future is doubtful, an opinion shared by most interviewed experts, including the tobacco farmers union member. Therefore, from an economic efficiency perspective, there is no rationale for the tobacco cultivation subsidy program. Nonetheless, the subsidy and the community development programs funded by the Regie in tobacco producing districts constitute a substantive transfer with many beneficiaries. As noted in the discussion on tobacco farming, tobacco cultivation is a family practice relying on the participation of most family members. These families are often low-income families, for whom tobacco cultivation is a part-time, seasonal, occupation that brings in some needed additional income and cash flow. Moreover, the two governorates with the bulk of tobacco cultivation, Akkar and Nabatieh, have the highest rates of poverty in the country [50]. Any changes to the current tobacco industry structure could have a significant negative impact on these farmers, making such proposals politically undesirable. As such, any reform should take into consideration a form of compensation for the current tobacco farming license holders. It should be noted that several of the challenges facing tobacco farmers are common to the general agricultural sector in Lebanon. Encouraging alternative crops is a policy often discussed and promoted by experts and policy makers, however, several recent experiences have seen limited success.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref013\"], \"section\": \"Conclusion\", \"text\": \"Beyond Lebanon\\u2019s borders, this study\\u2019s findings and policy recommendations hold relevance for similar settings globally, especially within the Eastern Mediterranean region, where WHO projections indicate a worrying rise in smoking prevalence [13]. The innovative use of an exploratory qualitative approach not only fills a significant gap in the literature regarding the political economy of tobacco but also sheds light on crucial issues such as monopolization, the absence of a national tobacco strategy, and inefficient cultivation practices. These insights are not only actionable for policymakers in Lebanon but also serve as a blueprint for crafting effective tobacco control policies in other countries facing similar challenges. Thus, this research serves as basis for guiding efforts to combat smoking and its associated socioeconomic impacts on a broader scale.\"}, {\"pmc\": \"PMC11957285\", \"pmid\": \"\", \"reference_ids\": [\"pone.0320050.ref051\"], \"section\": \"Limitations of the study\", \"text\": \"Future research should triangulate qualitative data with updated quantitative data to assess the impact of policy changes. This includes updated estimates of demand elasticities, tax simulation exercises, impact on revenues to the public treasury, distributional impact of the tax, and impact on prevalence [51].\"}]"

Metadata

"{\"Data Availability\": \"Data cannot be shared publicly because it includes self collected data that requires ethical consideration including obtaining an ethical approval from the American University of Beirut (AUB) Institutional Review Board (IRB) prior to recruitment and data collection. Ethics Committee (contact via IRB) for researchers who meet the criteria for access to confidential data. Encrypted or non raw data may be potentially shared with specific considerations. Data availability statement: This study analyzes data collected as part of qualitative research, which cannot be shared publicly due to ethical restrictions. We are bound by these restrictions from sharing a de-identified data set or excerpts from the transcripts, as doing so would violate the agreement to which the participants consented. The data contains potentially identifying and sensitive information, and the Institutional Review Board (IRB) imposes these ethical restrictions. The qualitative data includes self-collected information that requires ethical consideration, including obtaining ethical approval from the American University of Beirut (AUB) IRB prior to recruitment and data collection. Researchers who meet the criteria for access to confidential data can contact the third party: the Ethics Committee through the IRB at \", \"Submission Version\": \"2\"}"