UK smoking ban: what now for big tobacco?
UK prime minister Rishi Sunak has proposed banning younger generations from buying cigarettes. So, what now for big tobacco firms like Imperial Brands and British American Tobacco? IGTV financial analyst @AngelineOng finds out.
(Video Transcript)
Tobacco ban proposal causes uproar
Now, love it or hate it, Britain's proposed ban on cigarettes for younger generations is topical. It's being spoken about everywhere from the corridors to the dining tables. Those for it say it's a breakthrough. Smoking costs Britain's health services an estimated £17 billion. That's right, £17 billion a year.
Those against it say it's a creeping prohibition and a stealth tax. For tobacco giants, like Philip Morris, there was an outcry. Imperial Brands, showing you the chart here, which reaffirmed its forecast and announced a just over a billion pound share buyback, has hit back, saying the ban threatens unintended consequences.
Will other countries follow suit?
British American Tobacco, maker of Lucky Strike, also said that these proposals would be difficult to enforce. What is also interesting is the timing. Now, the writing for this rule was already on the wall in the UK.
The real concern for these big tobacco companies is that it will cause other countries to follow suit. Denmark, along with other nations already thinking about a similar move. The question is, can big tobacco move fast enough to replace the traditional products of those currently deemed safer and less addictive?
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