September 9, 2019
Continuing Our Commitment to Partner Capacity Building: Serbia and Indonesia
The Tobacconomics team’s exciting work continued through July and August in Serbia and Indonesia to continue to help build partner capacity in those regions.
Earlier this year, in our March blog series, we shared our approach to capacity building, broken down into a series of steps. The first is determining our ‘why’, ‘what’, ‘who’, ‘where’, and ‘how’ with each think tank. Then we move on to our research process. This includes four steps—identifying evidence gaps, selecting research topics, assessing data availability and training needs, and ensuring quality research and timely delivery. Back in July we explained how this approach played out at our annual UIC Asia Think Tank Partners Meeting in Dalat, Vietnam. In this installment, we show how our Tobacconomics Training sessions, recently delivered in Serbia and Indonesia support the capacity of think tanks to produce and disseminate local evidence on tobacco taxation.
From July 18-19, 2019 Tobacconomics Senior Economist, Violeta Vulovic and Tobacconomics expert, Rijo John delivered a Tobacconomics Training session in Belgrade, Serbia with South Eastern Europe (SEE) partner network led by the Institute of Economic Sciences. The training provided methods to estimate elasticities of demand for tobacco products by income group in order to analyze differing behavioral responses to tax changes among various income groups. Understanding these different responses helps to inform better tobacco tax policies.
Global evidence demonstrates that overall, people in lower-income groups are more responsive to tax increases on tobacco products—they are more likely to quit or reduce consumption faced with higher taxes than those in higher-income groups. Additionally, tobacco use tends to be concentrated among the poor, and tobacco use accounts for a significant share of the health disparities between the rich and poor. Tobacco use in poor households exacerbates poverty by increasing healthcare costs, reducing incomes, and decreasing productivity, as well as diverting limited family resources from basic needs and investments in nutrition and education, which interrupt the vicious cycle of poverty. By reducing tobacco use among the poor, significant increases in tobacco taxes can help break the cyclical relationship between tobacco use and poverty. The research undertaken by our partners in the SEE network will produce country-specific evidence to understand how the global evidence compares to local reality.
After the workshop in Serbia, Vulovic and John traveled to Jakarta, Indonesia in August for a training session with our partner think tank, Center for Indonesia’s Strategic Development Initiatives (CISDI) on the methodology for estimating the economic costs of smoking in Indonesia. This session resulted in a draft model for health costs estimation, which the CISDI team is currently applying. The meeting provided a chance for the Tobacconomics team to witness first-hand how CISDI’s research was progressing and receive feedback to provide additional support where necessary.
As noted in a recent Tobacconomics brief, tobacco use imposes a significant economic burden on a country, including the costs of healthcare to treat the diseases caused by tobacco and lost productivity resulting from tobacco-attributable morbidity and mortality. For every person who dies due to tobacco use, at least 30 people live with a serious tobacco-related illness. The total global economic cost of smoking is estimated at around $US 1.85 trillion, or around 1.8% of global GDP (PPP). Therefore, a significant increase in tobacco taxes can help close the gap between the cost of tobacco use and the revenue generated from tobacco taxes. Measuring the health and economic costs of tobacco use is an important piece of evidence to inform tobacco tax policy in any country, but especially where smoking prevalence rates are high, as in the case of Indonesia, where over two-thirds of adult males smoke (WHO, 2018).
The Tobacconomics team is excited to continue to advance our partners’ capacity to produce and disseminate local evidence to inform better tobacco tax policymaking. Tobacconomics training sessions are one way we provide this support. Stay tuned for future installments, where we discuss how we provide remote assistance through teleconference, webinar, and other distance-learning modalities.