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Pick your poison
Pick your poison
Bertrand Hauger
Servan Peca

LAUSANNE — The question has been debated for many years, but is now gaining more attention than ever: Has sugar become the new tobacco? Are there parallels, in other words, between current attempts to curb the use of addictive industrial glucose and the strict regulations applied to the cigarette industry starting in the late 1990s?

Last year, the U.S. bank Morgan Stanley calculated that between 2015 and 2035, exorbitant sugar consumption will take half a percentage point off the world's overall economic growth numbers. There has been a flurry of scientific studies too, along with the launch of anti-sugar health campaigns.

In recent years, authorities in various countries have specifically begun targeting soda. France (2012) and Mexico (2014) introduced a tax on sugar and sugary products. Belgium introduced a soda tax this past January, and the UK is considering doing the same in 2018. Discussions about sugar in Indonesia, India, the Philippines and Singapore have become more heated. In Switzerland, the idea exists and is advancing slowly.

On the opposite extreme is the U.S., where annual per capita soda consumption is 112 liters, according to Beverage Digest. American lobbyists completely block any anti-sugar legislation.

This is the first similarity between the sugar and tobacco industries: Like their tobacco counterparts, Coca-Cola and the other soft-drink giants work behind the scenes to; 1) fend off regulations by accusing governments of using soda taxes, in this case, to disguise other tax hikes, and; 2) question the accuracy of the heath studies used to justify those regulations.

Selling the problem and the solution

Another similarity between the two sectors is that neither market is transparent. The supply chains are complex with a variety of producers, and there are countless intermediaries and disparate regulations. Even the most educated experts concede that it is very difficult to understand the link between the wholesale and retail sugar prices.

Big Tobacco has been able to turn this opacity to its advantage. By coordinating the incorporation of the tax in price hikes, tobacco companies managed to maintain their sales and revenue. Additionally, food giants and tobacco companies like Philip Morris, British American Tobacco (BAT) and Imperial Tobacco gained market shares in developing countries, where health campaigns are not as advanced.

Coca-Cola, PepsiCo, Danone, Nestlé, and other soda, ice cream, and candy manufacturers are very aware that the crackdown on sugar will eventually prove successful. They have therefore adapted their products to include water, fruit juice, and other light products without added sugar. The goal is simple: retrieve their clients the day they change their eating habits.

Fake sweeteners and sugar — Photo: Ruaridh Stewart/ZUMA

By focusing more on nutrition, health, and wellness, Nestlé seems to be one step ahead. On the other hand, the company still keeps the candy and sugary brands that made it famous. The Bloomberg financial company describes Nestlé's strategy this way: "The company will retain its core business of chocolate products and other sweets while expanding its retail pharmacy and hospital networks."

So far, we haven't yet seen cigarette companies invest in anti-smoking patches. But they did jump on the e-cigarette fad pretty quickly. All major cigarette companies have bought at least one company or brand in this relatively new niche.

Studies have not yet proven that e-cigarettes reduce the risk of cancer, but tobacco companies are already heavily investing in them. Tobacco companies, just like Nestlé, are planning on selling both the problem and the solution.

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