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    World's Biggest Tobacco Market Could Ban Ads

    China's prohibition would deal "heavy blow" to cigarette industry.

    SHANGHAI -- China could ban cigarette ads following its signing of a United Nations anti-smoking treaty, dealing a "heavy blow" to the industry in the world's biggest tobacco market, an official newspaper reported Monday, according to the Associated Press.
    A ban on ads and promotions and other severe anti-smoking measures would follow ratification of the U.N. Framework Convention on Tobacco Control by the National People's Congress, China's legislature, at its annual session next spring, the Shanghai Daily said.

    China's government "fully supports" the convention, and the Health Ministry is in discussions with other government bodies on how best to implement it, the paper said.

    While the convention could provide some protection against cigarette smugglers and counterfeiters, it will hit the industry hard, said Zheng Fugang, secretary general of the China Tobacco Society, an industry group, the AP reported.

    The U.N. treaty requires restrictions on tobacco advertising and sponsorship, tougher health warnings that would cover half the surface of a pack of cigarettes, limits on language like "low-tar" and "light," and restrictions on public smoking. It would also encourage companies to raise tobacco prices and taxes.

    China's UN ambassador, Wang Guangya, signed the convention in New York on Nov. 10, making China the 77th country to sign the agreement, which was adopted by the United Nations in May. Only five countries have ratified it so far.
    The United States has yet to sign.

    China's NPC usually meets in March, and the convention would take effect 90 days after ratification.

    "It will deal a heavy blow to China's tobacco business," Zheng was quoted as saying.
    China's 350 million smokers -- one-third of the world total -- generated 130 billion yuan (about $15.8 billion) in profits and tax revenues over the first nine months of this year. The industry contributed 10 per cent of the country's total tax revenue last year.

    Alarmed by rising health costs, China has imposed some restrictions on smoking and cigarette advertising. About two-thirds of Chinese men smoke, but only about 5 percent of women.

    The industry is dominated by domestic companies mostly based in the southwestern tobacco producing province of Yunnan. They are among the country's most important firms, according to the Associated Press.

    In an odd juxtaposition that underscored those companies' influence, China's national soccer team trained for last year's World Cup at a sports centre in Yunnan that is run by and named after Hong Ta, the country's largest tobacco company.

    Shanghai, China's largest city and commercial hub, is also counting on tobacco advertising generating revenue for its Formula 1 racing track now under construction, the AP reported.

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