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BAT South Africa urges government to lift cigarette sale ban

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BAT South Africa urges government to lift cigarette sale ban

A man walks past the British American Tobacco offices in London

JOHANNESBURG (Reuters) - The South African arm of British American Tobacco <BATS.L> urged the government on Saturday to reconsider its ban on cigarette sales during the nationwide coronavirus lockdown, saying it would have unintended consequences.

South African officials have imposed some of the toughest anti-coronavirus measures on the continent, including a 21-day "stay at home" lockdown that started last week Friday.

During the lockdown, essential services retailers and petrol station forecourt stores are not allowed to sell alcohol or cigarettes.

The government has justified the ban on studies showing that smoking can make people more susceptible to serious complications from a coronavirus infection.

British American Tobacco South Africa (BATSA) said it supported the decisive measures taken by the government but warned the ban on cigarette sales could jeopardise the fight to contain the virus.

"It will unintentionally force 11 million smokers to go outside of their neighbourhood in search of outlets willing to defy the ban, as we've seen in some media reports," it said in a statement.

"This would lead to greater movement of people and more interactions than if smokers were able to buy cigarettes at their nearest legal outlet at the same time as buying all their other essential goods."

The tobacco group also warned that the ban could boost illicit trade in tobacco as smokers were more likely to buy from underground traders.

BATSA is the leading tobacco manufacturer in South Africa with 78% market share of the legal cigarette market. It sells cigarettes through 50,000 outlets including grocery stores, liquor shops, spazas, informal traders and fuel stations.

In 2019, BATSA contributed 13 billion rand ($682.99 million)in total taxes of which 10 billion rand was tobacco excise.

In a statement, the Chairperson of the Fair-trade Independent Tobacco Association (FITA) also urged the government to reconsider the nationwide ban.

"Uplifting the ban would, amongst other things save jobs, bring more money into the state coffers, stimulate the economy, and decrease the psychological impact on South Africans of the lockdown period," FITA Chairperson Sinenhlanhla Mnguni said.




(Reporting by Nqobile Dludla, Editing by Christina Fincher)