Is the future of vaping in China's hands?

Made in China

Introduction

First off, a few numbers to understand the situation of vaping in China :

China represents 90% of the electronic cigarettes production in the world with 1500 manufacturers and 5.5 million jobs, all concentrated in the Shenzhen region. On the domestic market alone, 2021 saw the revenue of the vape industry nearing 3 billion dollars with an annual growth of 36%. 

A new law

On March 11, The State Tobacco Monopoly Administration (STMA), the government agency responsible for the regulation of tobacco products in China, published a new law that will come into effect on May 1st, 2022. Its purpose is to legislatively assimilate the electronic cigarette to the conventional cigarette, and to remove vape products from the legal no man's land where they’ve been up to now. 

There is nothing very innovative in this strategy, Switzerland is doing the same. So why are we interested in this issue ? Quite frankly, because China is a separate and influential place where the rules of the game are not the same as elsewhere. And when China sneezes, the rest of the world is afraid to catch a cold.

This law entitled "Administrative measures concerning the electronic cigarette" states that, from now on, vape retailers will have to be registered on a central file to obtain a permit to continue practicing their profession. In addition, manufacturers will have to prove their financial capacity to maintain a satisfactory production, as well as meet strict specifications regarding production rules and quality standards.

According to China, the aim is to standardise production with higher quality criteria and to align tax policy with those of the tobacco industry.

Let's look at the situation

The China National Tobacco Corporation (CNTC) is now the world's largest cigarette manufacturer, accounting for 40% of global sales. The company is wholly owned by the Chinese government, and thus by the STMA, which is the instigator of this new law.

Objectively, it’s a takeover by the Chinese government of the production and control of the sale of electronic cigarettes on the domestic and international markets. It’s also the creation of a long-term global monopolistic control over the production and sale of tobacco and vape products.

This means 2 things :

First, that China has every interest in developing e-cigarettes given its potential positioning worldwide. But above all, that this monopoly will allow to dictate the future global policy on vaping as well as smoking.

Chinese factory

A commitment to future

What if China's long-term goal was to revolutionise the world of cigarettes as we know it today. To its benefit, of course ! But could the consequences for the rest of the world be positive ?

Through Kimree Technology, the 4th largest patent company in the world, CNTC already owns 27% of all patents in the world regarding alternatives to conventional cigarettes with considerable sums allocated to research and development.

To date, one of the main obstacles to the expansion of pro-vape policies worldwide is the World Health Organisation’s (WHO) hostility towards tobacco substitutes. This hostility is matched only by China’s defiance of WHO recommendations. This future monopoly could very well change the situation and China could end up forcing the WHO to reconsider its position.

China Vape World

Conclusion

What if China became the solution to the smoking problem ? Probably not for noble public health reasons. But what if, for once, economy and smoking cessation could come together through a shared objective : The end of smoking. 

Why not ? 


Thank you for reading. 

The Sweetch Team