Why Libya's Future Is a Haze of Cigarette Smoke
WHY YOU SHOULD CARE
Its civil war has turned Libya into the region’s cigarette smuggling leader.
By Charu Sudan Kasturi
The footage was dramatic — Mutassim Gadhafi, son of Libyan dictator Moammar Gadhafi, smoking hours before he was killed in October 2012. But while one part of those images — the Gadhafi family — is now history, another is disturbingly present. Seven years into Libya’s civil war, contraband cigarettes have taken hold of the nation and are fueling the conflict. Even proverbs stand upended. In Libya, where there’s fire, there’s smoke. Lots of it.
Battered by conflict and raided by terrorists, Libya — once one of the world’s large oil producers — has witnessed its exports drop to a fifth of 2010 levels. Its imports declined by 60 percent between 2010 and 2016.
But while Libya can no longer afford to buy some commodities it used to purchase, it has emerged as Africa’s leading importer of rolled tobacco, according to the World Bank. From 2014 to 2016, those imports totaled $485 million, 50 percent more than second-place Morocco.
Ordinary Libyans aren’t smoking more. Instead, most of Libya’s cigarette market is illegal, with fakes produced and smuggled by militias to keep their campaigns — and the war — alive.
Libya imports more rolled tobacco than any other African country — and uses 93 percent of it to make contraband cigarettes.
Libya’s own cigarette manufacturing industry collapsed during the war, necessitating massive imports, British firm GlobalData said in a 2017 report. But instead of importing cigarettes, the country’s multiple militant groups and even local communities began purchasing tobacco and producing counterfeit cigarettes. These both serve local demand and are smuggled across North Africa, according to 2017 research by consulting firm KPMG.
“It is beyond argument that many groups … secure their livelihood out of cigarette smuggling, among other things,” says Dalia Ghanem-Yazbeck, a resident scholar at the Carnegie Middle East Center in Beirut.
The scale of the contraband cigarette economy is staggering. In 2016, the highest number of illegal cigarettes in the Maghreb region were consumed in Libya — 6.44 billion, or 93 percent of all cigarettes smoked in the country, according to KPMG. Tunisia was next, with 4.64 billion. GlobalData’s figure is more conservative — it says 80 percent of all cigarettes consumed in Libya in 2016 were copies of global brands. But GlobalData’s research also projects that cigarette consumption in Libya is set to grow by 25 percent between 2015 and 2025, so the cigarette smugglers have clearly hit upon a sunrise industry.
The Libyan groups smuggling contraband cigarettes aren’t just targeting the domestic market, though. “Many of the brands identified [in Tunisia] were similar to those identified in Libya, indicating that once cigarettes arrive in Libya, some are transferred across the border,” the KPMG study says.
When a state is a failed one … what [apart from smuggling] is left for these communities to live from?
Dalia Ghanem-Yazbeck, Carnegie Middle East Center
Libya’s porous borders make the country attractive as a launch pad for the illegal cigarette smuggling industry in North Africa. Many of the other national borders in the region are sealed and closely monitored — the Algeria-Morocco border, for instance, has been closed since 1994. “Algeria due to its policed borders has succeeded in reducing cigarette smuggling,” says Ghanem-Yazbeck. “The country witnesses a low inflow, so, yes, border security matters.”
Libya’s frontier with Niger, on the other hand, has remained lightly manned since the 2011 uprising that led to the overthrow of the Gadhafi regime, say experts. “The unstable political situation in Libya, post-revolution, has played a significant role in reducing law enforcement in relation to the illicit cigarette trade in the region,” says the KPMG report.
But the economics of desperation are also at play here. Many families in northern Niger and southern Libya have tribal or community relations. With the collapse of Libya’s formal economy because of the civil war, they have taken to smuggling to support themselves, say experts like Yazbeck and research by firms like KPMG. “When a state is a failed one [and] unemployment and socioeconomic conditions are dire, what is left for these communities to live from?” asks Ghanem-Yazbeck.
Still, not all smuggling is solely for sustenance. When there are no well-defended borders, “groups, whatever their nature, can operate freely and with total impunity,” says Ghanem-Yazbeck. Some terror groups, such as al-Qaeda in the Islamic Maghreb, are believed to avoid direct smuggling activities, but they provide shelter and protection to convoys and smugglers for fees. So, the illicit trade helps them fill their coffers.
There’s also a loss of revenue to Libya. According to the KPMG study, in 2016 Libya would have earned $198 million in taxes had the cigarettes consumed been bought legally. That, according to World Bank statistics, would have covered the cost of all medicines the war-torn nation imported that year.
Cigarettes are sustaining — if not deepening — cleavages that have bled Libya for seven years. The future? It’s a haze of cigarette smoke.
- Charu Sudan Kasturi, OZY Author Contact Charu Sudan Kasturi