Chinese Tobacco Company Plans to go IPO in Hong Kong

China National Tobacco Corp., a state monopoly that is reportedly the world’s biggest cigarette manufacturer, plans to list itself on the Hong Kong stock exchange, despite pressure on the local government to combat smoking.

Diane Caruana

January 9, 2019

The unit that will be listed is the company’s international unit, China Tobacco International Inc., and is mainly responsible for procuring tobacco from other countries such as Brazil and Canada. This unit is only a small part of China Tobacco’s overall business, which is said to have a bigger market share than the next five global tobacco companies combined.

China has one of the world’s most deep rooted smoking cultures, equating to 300 million smokers or nearly one-third of the world’s total.

On the other hand, this listing presents a major opportunity for the company, as like other tobacco companies it is thankfully facing growing threats as the world becomes more aware of the dangers of smoking.

In 2016 Mao Qun’an, head of the National Health and Family Planning Commission’s publicity department, had announced a nationwide ban on smoking in public spaces. “Strictly controlling smoking in public places in a legal way is a promotion for health,” said Qun’an at the time. “That smoking harms health has become a global consensus”.

How declining smoking rates could also have negative repercussions

China is renowned for having one of the world’s most deep rooted smoking cultures, which according to the World Health Organization (WHO), equates to 300 million smokers, nearly one-third of the world’s total. This of course means that the dwindling smoking rates, despite undoubtedly having a positive effect on public health, could also carry significant negative social and economic implications, and that if not managed could have serious repercussions on the country.

Read Further: Fortune