Retail Associations and Small Traders Reject Tobacco Plain Packaging Proposal
Retail associations and small traders are rejecting the Ministry of Health’s plan to impose standardised packaging on processed tobacco products, or plain packaging. Concerns are mounting that the regulation will further batter the industry broadly and disrupt President Prabowo Subianto’s administration’s efforts to safeguard national economic stability.
Solihin, Chairman of the Indonesian Retail Entrepreneurs Association (APINDO), said the tobacco sector has contributed significantly to retail business revenues in the downstream sector. He believes the plain packaging policy in the draft ministerial regulation will result in lost income for business operators.
“The Ministry of Health’s role must not overlap. There are ambiguous articles that cannot be implemented, so will those articles merely become window dressing? Meanwhile, on the ground, ‘settlements’ occur with certain individuals. The input, process, and output are already flawed,” he said on Monday (15/6).
From the traders’ association perspective, the plain packaging rule is seen as impacting the viability of small-scale retailers, kiosk owners, and street vendors who depend on cigarette sales.
Ali Mahsum Atmo, Chairman of the Indonesian Street Vendors Association (APKLI), explained that Government Regulation No. 28/2024 alone has already reduced small traders’ turnover, and it will decline further if the plain packaging policy is issued.
“If the rule on uniform cigarette packaging without brand identity, or plain packaging, is also implemented, the impact on the people’s economy will be even greater, including on street vendors, kiosks, and other tenants,” Ali said.
Anang Zunaedi, Vice Chairman of the Indonesian Retail Cooperatives Association (AKRINDO), revealed that cigarette sales can contribute 20 to 30 percent of traders’ total turnover. The contribution can be even larger at the micro-trader level because cigarettes are their main product. Therefore, his association firmly rejects the regulation.
“The Ministry of Health must be very careful in issuing regulations, because social conflict will certainly arise, that is certain,” Anang said.
Junaedi, Chairman of the All-Indonesia Kiosk Traders Association (PPKSI), stressed that cigarettes are typically purchased alongside other products. When cigarette sales fall, it will also affect sales of other items.
“This rule makes it very difficult for us to sell cigarettes on the ground. Moreover, these cigarette products are legal, so they cannot be banned; restrictions already exist. Our turnover will definitely drop. Cigarettes pull other products to be sold as well, but if cigarette sales decline, the others will certainly decline too,” he added.
Beyond hitting small traders’ incomes, Mujiburrohman, Secretary General of the All-Indonesia Market Traders Association (APPSI), sees the plain packaging plan reducing market traders’ turnover. He considers the Ministry of Health’s claim that the policy idea will curb child and adolescent smoking to be misguided.
“The Ministry of Health should prioritise comprehensive education to achieve that goal (reducing the prevalence of child and adolescent smokers). Awareness of health risks can help reduce the interest in smoking among youth,” he asserted.
Standardising packaging with uniform colours will erase the distinctive characteristics and brand identity that have been the main differentiators for these legal products. Excessively low nicotine limits are seen as likely to hit tobacco and clove farmers, the two commodities that are the raw materials for kretek cigarettes. Brand-free packaging standardisation is considered to affect the ecosystem of various sectors.