Thursday, July 7, 2016
Thailand - War on sugar: Can taxman extract Asia's sweet tooth?
More countries proposing a tax on sugary drinks, but F&B industry puts up resistance
On a sweltering evening in downtown Bangkok, thirsty joggers crowd around a drinks kiosk in Sukhumvit Road. Most reach for chilled water, or sweet ready-mixed green tea, each bottle containing almost 90 per cent the daily recommended allowance of sugar.
Thai health advocates are trying to bring this under control. Last month, a junta-appointed reform assembly submitted a proposal to tax packaged drinks according to their sugar content. This could result in beverages like soda, coffee, green tea and energy drinks becoming at least 20 per cent more expensive, and hopefully keep a lid on the incidence of obesity, diabetes and hypertension in the fast ageing country.
Thailand's attempt to wean its people off sugary drinks is part of a growing trend in Asia, where increasingly calorie-rich diets and sedentary lifestyles are producing health complications that threaten national budgets.
Philippine lawmakers last November introduced a Bill to charge a 10 per cent tax on sweetened drinks. India policymakers have proposed a 40 per cent rate. Vietnam mulled over but eventually scrapped a proposed 10 per cent tax in 2014 after commercial pressure, while Indonesia is facing similar opposition over its soda tax plans.
Singapore has no such tax, but the idea was brought up during last month's parliamentary debate.
The Singapore health authorities say that Asians are genetically more predisposed to diabetes than Caucasians.
Dr Annie Ling, director of policy, research and surveillance at Singapore's Health Promotion Board, has said that for the same amount of carbohydrates consumed, the glucose response in the blood of Asians could be as high as double that of Caucasians.
The World Health Organisation (WHO) recommends sugar consumption be limited to 12 teaspoons or about 50g a day, a limit easily reached by drinking one can of soda. Worryingly large numbers of children in Asia are doing this daily.
According to WHO data, 57.7 per cent of Thai children aged between 13 and 15 years consume carbonated soft drinks one or more times per day. In Brunei, the figure is 46.3 per cent; in Cambodia, 45.6 per cent; and in the Philippines, 42.2 per cent.
The overconsumption of sugar is "serious in most - if not all - Asian countries", Dr Katrin Engelhardt, the technical lead for nutrition in the WHO's regional office for the Western Pacific, tells The Sunday Times. "Sugar-sweetened beverages are a key source of sugar consumption in Asia", where its growing economies represent an important market for the food and beverage industry.
Indeed, it is the companies in this industry that put up the stiffest resistance to higher taxes. For instance, the Indian subsidiary of Coca-cola Co, which employs 25,000 staff, warned last year that it would be forced to consider shutting down some of its factories if there was a sharp decline in sales. And Indonesia's bottled tea maker PT Sinar Sosro told the Wall Street Journal last year that the tax may prompt the company to reconsider investment plans.
The consumption of sugar across Asia is steadily rising. According to data by market research firm Euromonitor, Japan topped the list of Asian countries in terms of sugar consumed from packaged food and drink in 2014. That year, each person in Japan consumed 75.2g of sugar every day, compared to 53.59g in Hong Kong, 31.75g in Singapore and 29.81g in Thailand.
But these figures likely understate the actual amount of sugar consumed, as they do not take into account sugar added to freshly prepared food and drink.
Thais, for example, spoon sugar onto their noodles. According to Dr Piyada Prasertsom, the manager of Thailand's Sweet Enough Network, which combats childhood obesity, each Thai person consumed an average of 100g of sugar every day last year.
The WHO says governments should complement fiscal measures by requiring sugar content to be properly displayed on food labels, as well as restricting the marketing of foods and drink high in salt, sugar and fat to children.
Thailand's health ministry has been urging government agencies to downsize snacks served during meetings, as well as offer water instead of soda.
But it is the tax proposals that have ruffled the most feathers. According to media reports, the Thai Beverage Industry Association has questioned the link between obesity and drinking soda.
Shopkeeper Chaiwat Pawanthapong, who sells soda and other drinks in Bangkok, warns that gloomy economic conditions may not be conducive to such a tax. "You don't want to impose a bigger burden on people," he said.
However, Dr Pornpan Bunyaratpan, a key member of the Thai National Reform Steering Assembly who is advocating the tax, points out that it need not be this way.
"If the companies reduce the amount of sugar in their drinks, they make people healthy and they won't be subject to the tax," she said.