Domino effect likely for businesses, economy with tobacco policy, warns FMM

KUALA LUMPUR: The Federation of Malaysian Manufacturers (FMM) has expressed concern over the domino effect on the business community and the country's economy arising from the Control of Tobacco Products and Smoking Bill 2022.

President Tan Sri Soh Thian Lai said that while the federation agreed that steps need to be taken to reduce the smoking prevalence in Malaysia, measures such as the Generational Endgame (GEG) need to be viewed more holistically with close engagement with all stakeholders.

These include those related to the tobacco and vape supply chain, such as manufacturers, warehouses, logistics, distributors, sundry retailers, convenience stores, and coffee shops.

"If not managed properly, the bill's implementation may cause an increase in unemployment rates in the long run as businesses involved in the supply chain of these products could be forced to trim down their workforce due to lower revenue.

"We also cannot discount the impact of such policies on foreign investors," he said in a statement today.

In addition, Soh said Malaysia could be perceived as a restrictive country, discouraging foreign direct investments as the GEG policy sets a precedent that could be imposed on other industries in the future for similar reasons.

He added that the focus should be on addressing rampant illicit tobacco products in Malaysia, where nearly 60 per cent of products sold are smuggled.

"The GEG policy does not address this issue and may lead to further worsening illegal cigarette trading activities.

"It is, therefore, crucial for the government to come up with win-win and holistic solutions for both the government and the industry in findings ways to reduce smoking prevalence without taking drastic steps, especially in the current economic climate.

"The business community and the rakyat are already facing enough challenges, such as the rising cost of goods and raw materials and labour shortages.

"There needs to be better engagement with stakeholders in the supply chain for the industry to find a middle ground on the matter," he said.

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