BUSINESS PEOPLE and traders are urging that the discourse on the uniformity of unbranded cigarette packaging policy in the Draft Minister of Health Regulation (Draft Permenkes) must be cancelled. This must be done considering the large impact on the tobacco products industry and its ecosystem on the regional and national economy.
Chairman of the East Java Chamber of Commerce and Industry (Kadin), Adik Dwi Putranto, underlined that the process of formulating policy discourse should be data-based and involve all relevant parties. However, in fact, the process of formulating Government Regulation Number 28 of 2024 (PP 28/2024) and the Draft Minister of Health did not have in-depth studies and did not involve various stakeholders involved in the tobacco sector.
According to him, this policy could harm many parties, from farmers, workers, to small grocery stores that depend on cigarette sales to run their business.
“What will happen to grocery stores, which are the main source of livelihood for small traders, if this regulation is passed? It could have serious impacts if this policy is passed,” said Adik in a media discussion entitled Chasing 8% Economic Growth: Challenges for the Tobacco Industry Under the New Policy in Jakarta, quoted in official statement, Thursday (7/11).
According to him, the Ministry of Health (Kemenkes) is trying to suppress the tobacco products industry haphazardly through various policies without any solid studies.
“Because a brand is not just an identity, but also a tool to prevent counterfeiting. “Without a clear brand identity, the potential for product counterfeiting increases and encourages the circulation of illegal cigarettes, which will actually be detrimental to the government and society,” he explained.
East Java (Jatim) itself, said Adik, is very dependent on the contribution of the tobacco products industry. Based on data, regional income from cigarette taxes reached IDR 19.6 trillion, with a contribution from the tobacco industry of around IDR 12 trillion. In East Java itself, the employment rate for people with disabilities in the tobacco industry has reached 4%, far above the national requirement of only 1%.
For Adik, policies that overly restrict the tobacco industry will have a direct impact on society. Apart from that, East Java has 200 hectares of tobacco land which absorbs hundreds of thousands of workers in the agricultural sector. Therefore, if the government sets an economic growth target of 8%, employment in the rural sector needs to be increased.
“Tobacco is one of the sectors that contributes greatly to the economic cycle in rural areas. “With available jobs, farmers and agricultural laborers can earn sufficient income, so that the wheels of the economy can turn well,” explained Adik.
Meanwhile, the Secretary General of the All Indonesian Market Traders Association (APPSI), Mujiburrohman, also gave a similar view regarding the implementation of the Draft Minister of Health regarding the plan to uniform cigarette packaging without brand identity.
He believes that this policy needs to be canceled because it has a big impact on market traders. This regulation, according to Mujiburrohman, could encourage the circulation of illegal cigarettes in traditional markets, which in the end would actually reduce traders’ turnover.
“Currently, traders’ income has decreased due to downtrading, namely the shift of consumers to cheaper cigarettes. Coupled with the potential entry of illegal cigarettes, traders are increasingly worried that their turnover will fall further,” he said.
Not only that, he added that market traders had not been involved in formulating these regulations. He also proposed that the regulations be reviewed and adjusted to the objectives carried out by the relevant ministries. According to him, the Ministry of Health and the Ministry of Finance have opposing, but complementary roles.
“On the one hand, the Ministry of Health is tasked with maintaining public health, while the Ministry of Finance needs revenue for the APBN. This regulation on uniform cigarette packaging without brand identity will actually facilitate counterfeiting and uncontrolled distribution. “Illegal cigarettes are increasing and the Ministry of Health’s health goals are also not being achieved,” he explained.
Thus, he hopes that the government will take wise steps in establishing this policy. There should be no indication that certain influences are actually counter-productive.
“We only have one request, please review it by considering the interests of all parties, especially market traders who are part of the people’s economy,” he concluded. (J-3)
#Unbranded #cigarette #packaging #feared #threaten #economic #growth
**Interview with Adik Dwi Putranto, Chairman of the East Java Chamber of Commerce and Industry (Kadin)**
**Interviewer:** Thank you for joining us today, Mr. Putranto. Your recent comments regarding the Draft Minister of Health Regulation on unbranded cigarette packaging have raised significant concerns. Can you elaborate on why you believe this policy should be canceled?
**Adik Dwi Putranto:** Thank you for having me. The main reason we advocate for the cancellation of this policy is its potential to severely impact not only the tobacco industry but also the entire ecosystem that relies on it. This includes farmers, workers, and small grocery stores. The policy was formulated without thorough research and failed to engage relevant stakeholders. It’s crucial that economic policies are data-driven and consider the voices of those affected.
**Interviewer:** You mentioned that grocery stores would be significantly impacted if this regulation passes. Could you clarify what those impacts might be?
**Adik Dwi Putranto:** Certainly. Grocery stores often rely on cigarette sales as a main source of income. If unbranded packaging is enforced, it may lead to a decrease in sales due to reduced consumer trust and brand recognition. This would directly threaten the livelihoods of many small traders who depend on these sales, potentially leading to a ripple effect throughout the economy.
**Interviewer:** You also raised concerns about product counterfeiting in your statements. Why is a recognizable brand important in the tobacco industry?
**Adik Dwi Putranto:** A brand serves as an identity and a safeguard against counterfeiting. When cigarettes are sold without a clear brand identity, it opens doors for counterfeit products. This not only harms legitimate businesses but also puts consumers at risk and undermines government efforts to regulate the market. The illicit trade could ultimately result in decreased tax revenues, which are vital for funding public services.
**Interviewer:** How does the tobacco industry contribute to the economy in East Java specifically?
**Adik Dwi Putranto:** The tobacco industry is a significant contributor to our regional economy. For instance, cigarette taxes alone bring in IDR 19.6 trillion to the region, with approximately IDR 12 trillion coming directly from the tobacco sector. Additionally, the industry provides jobs, especially for marginalized communities, like people with disabilities, where employment rates in our sector are notably higher than the national average. Our agricultural sector alone supports hundreds of thousands of workers.
**Interviewer:** Lastly, what message would you like to convey to policymakers regarding this issue?
**Adik Dwi Putranto:** I urge policymakers to consider the broader economic implications of their decisions. If the goal is to achieve 8% economic growth, we must support industries that are already contributing significantly to that target. Restricting the tobacco industry without a solid foundation of research and stakeholder input could have dire consequences for employment and economic stability in rural areas. We need productive dialogue between the government and industry stakeholders to create balanced and effective regulations.
**Interviewer:** Thank you very much, Mr. Putranto, for sharing your insights.
**Adik Dwi Putranto:** Thank you for having me. It’s vital to discuss these issues for the benefit of our economy and community.
