How cigarette manufacturers have multiplied entities and established themselves inside the Brazilian government in order to hinder the execution of the Framework Convention on Tobacco Control, of which Brazil is a signatory.
Since 2014, agricultural engineer Delcio Sandi has held the position of director for foreign and government affairs for the Brazil division of British American Tobacco, BAT, one of the world’s largest cigarette manufacturers. The pompous job title is a common euphemism for those who work in the centers of power defending private interests. In everyday terms, Sandi is a lobbyist.
The executive has been working in the tobacco sector for almost two decades. And in the meantime, he has held at least four other positions which assure him that there will be open doors in the main corridors of power in Brasília. His name appears in a 2015 meeting of the Sectorial Chamber of the Tobacco Production Chain as a member of the São Paulo Tobacco Industry Union (Sindifumo-SP), an entity that he continues to represent at meetings involving the sector.
At the end of 2018 Sandi took part in a hearing at the Senate Committee on Consumer Protection Transparency, Governance, Oversight and Control. At the hearing he presented the industry’s concerns in the face of a bill proposed in 2015 by José Serra (PSDB-SP). The bill seeks to ban the advertising of tobacco products at points of sale, such as newsstands – a measure already adopted in several countries, such as Uruguay. At the time, Sandi was wearing an Abifumo shirt, the Brazilian Tobacco Industry Association.
In the following year, 2019, the BAT – former Souza Cruz – executive, took part in a meeting at the offices of the Internal Revenue Service as an advisor for the Brazilian Institute for Ethics in Competition (Instituto Brasileiro de Ética Concorrencial – ETCO). At the meeting, which took place with Marcelo de Sousa Silva, then assistant special secretary for the entity, he presented a study commissioned by the organization from the Getúlio Vargas Foundation (FGV) on the “impact of cigarette smuggling on the economy”, one of the major flagships of the tobacco lobby (which we will soon address).
In that same year, Sandi was again in Brasília, this time as a representative of the Interstate Tobacco Industry Association, SindiTabaco, at hearings on electronic cigarettes promoted by the National Health Surveillance Agency (Anvisa).
BAT, Sindifumo-SP, Abifumo, ETCO, SindiTabaco: Sandi is an example of how the tobacco industry spreads itself through different acronyms, names and Corporate Tax Registration numbers, but often places the same people to defend the same positions as always. It is a tactic that makes the tobacco lobby seem bigger than it really is, repeating faces that work for the same interests but under a variety of mutually reinforcing companies or entities, simulating false consensus.
Lobby meeting point
On consulting the public agendas of members of Anvisa’s collegiate board of directors and representatives from the Ministry of Economy, we ascertain that between August 2016 and September 2021, 30 meetings took place with representatives from BAT Brasil. Out of 16 times that meeting participants are mentioned by name, Sandi’s name appears in 15.
“We contacted Sandi through BAT’s press office regarding her performance in defending the industry and her expectations in light of the change in government, but there was no response. After the publication of the report, the company sent a statement stating “that BAT Brazil’s participation in industry associations and class entities is legitimate and common in different economic sectors” and that it believes that “nonpartisan relationships between the public, private, and civil society sectors are inherent characteristics of democracy”.
Sandi’s activities also include visits to Congress (not registered in official agendas), the Ministry of Justice and mainly to the Ministry of Agriculture, Livestock and Supply (Mapa). Mapa houses the tobacco lobby meeting point: the Sectorial Chamber of the Tobacco Production Chain.
Created in 2003, the then named Tobacco Sectorial Chamber (later renamed) was heterogeneous, including not only entities connected to the cigarette-producing corporations (Brazil is home to the major multinationals), but also representatives from public banks, the Internal Revenue Service, the ministries of Finance and Development, Trade and Industry, in addition to workers’ associations such as CUT, and for small farmers such as ANPA, from Bahia. The group also tried to include all the tobacco-producing states, spread throughout the Southern, Southeastern and Northeastern regions of Brazil.
Up until 2007 the forum was of an advisory nature, but with the arrival of Reinhold Stephanes as head of Mapa, the Chamber’s profile changed. Appointed to the Ministry in Lula’s second term and with a political trajectory which had started in the days of the dictatorship, the collegiate became deliberative under his leadership. It was not long for the industry to see this as an opportunity to guide its positions in defense of tobacco from a privileged place: from within the Brazilian State.
Two years after the Framework Convention on Tobacco Control was ratified, the federal government became the main forum for originating arguments to convince public authorities to bar key measures for the implementation of the international treaty, such as the increase in cigarette taxes and the offer of alternatives for tobacco growers to diversify their tobacco monoculture.
A survey of the Sectorial Chamber minutes over these 20 years shows that the industry has taken over the collegiate. Out of the 17 entities, state government agencies and federal bureaus that took part in the discussions in 2003, there remains only a clique formed by the Brazilian Association of Tobacco Farmers (Associação dos Fumicultores do Brasil – Afubra), as directors of the chamber, Amprotabaco, which brings together mayors from producing municipalities, and the entities which directly represent the industry: Abifumo, SindiTabaco, Sindifumo-RJ, Sindifumo-SP, Sitfa – as well as a representative from Mapa itself.
Alexandre Octávio de Ribeiro Carvalho, a former member of the National Commission for the Implementation of the Framework Convention on Tobacco Control (Comissão Nacional para Implementação da Convenção-Quadro para Controle do Tabaco – Conicq), based at the National Cancer Institute (Inca) and dissolved by the Bolsonaro government, has been monitoring, for the last 20 years, the industry’s moves against the only health treaty that still exists.
In an interview with Joio, he said that the profile change in the Chamber promoted by Stephanes, the current Secretary for the State of Paraná, has rendered it schizophrenic. “A Technical Chamber was turned into a political one, creating and installing a formal opposition by the government against the Framework Convention”, summarizes Carvalho, who supplies the Observatory on Tobacco Industry Strategies, located in Fiocruz. “All these entities act together to neutralize the advances of efforts towards reducing smoking.”
The conclusion by Carvalho is a result of situations such as a Sectorial Chamber meeting held in July 2015, during Dilma Rousseff’s second term. On that occasion, Abifumo CEO Carlos Galant made the following proposal: to unify all the working groups of the forum into one under the title “Framework Convention on Tobacco Control Group”.
This mega-group would guide all entities of the Chamber in favor of two objectives:
1) monitor draft bills against cigarettes; and 2) work towards the creation of two parliamentary fronts with the same focus, one to fight smuggling and the other on intellectual property and piracy.
The suggestion was approved unanimously. Thus, the union of the seven main tobacco lobbies to hinder the implementation of the health treaty was sealed.
A survey conducted by Joio lists 11 pro-tobacco entities that currently occupy the Sectorial Chamber. Delcio Sandi participated on some occasions in the Chamber meetings, such as the one in 2015. On that occasion, he was surrounded by the main tobacco lobby figureheads: Benício Werner, Carlos Galant, Iro Schünke and Romeu Schneider.
Benício Werner is the current president of Afubra, the entity which theoretically represents the interests of tobacco farmers, but is much more in line with the industry. Evidence of this is the defense of ESDs, electronic smoking devices, which use little or no tobacco in their composition – a technological shift with the potential to reduce the demand that nowadays sustains the 128,000 associated tobacco growers. Werner is always accompanied by Romeu Schneider, who is the Afubra secretary and current president of the Sectorial Chamber.
Carlos Galant is the name behind Abifumo, and has, in Carvalho’s opinion, unified the discourse in the sector’s defense over the past 20 years. A native of Pelotas, Rio Grande do Sul, his lobbying activities ensured that in 2003 the association that represents the largest cigarette corporations in Brazil such as BAT Brasil, Philip Morris and Japan Tobacco International (JTI), joined the Sectorial Chamber and the National Industry Confederation (CNI), an entity that houses SindiTabaco. Abifumo and SindiTabaco consider themselves “co-sisters”.
When the Framework Convention was ratified by Brazil, in 2005, Abifumo joined the National Forum to Combat Piracy (FNCP), another entity connected to ETCO, the institute for ethics in competition. FNCP and ETCO are not solely associated to the tobacco industry, since they represent other economic sectors, but their surveys on cigarette smuggling are weapons used in an attempt to undermine price and tax increase initiatives, which have proven to be effective against smoking.
The argument that a price increase will end up boosting the illegal market even more is exhaustively repeated by Sandi, Galant, Schünke and the Amprotabaco mayors, such as the current president of the entity, Marcus Vinicius Pegoraro, and executive secretary Guido Hoff, the most regular Amprotabaco attendee at the meetings in Brasília. The allegation that a price reduction impacts the illegal Market is disputed by the World Health Organization (WHO), based on a study of the Brazilian illegal market setup.
If Delcio Sandi is the industry figure who changes hats according to the occasion, moving around in many levels of power on behalf of different entities, Iro Schünke is the conductor of the unions representing the sector giants. The web of lobby body relations extends through different associations and entities, led by the father figure, SindiTabaco, chaired by Schünke since 2006. It is a constellation of acronyms, including Sindifumo representatives from São Paulo, Rio de Janeiro and Bahia, in addition to partner entities such as Afubra, Amprotabaco – born in 2013 under SindiTabaco’s blessing – and Stifa.
Schünke, now 75 years of age, an agricultural engineer born in Candelária, a small town in Rio Grande do Sul’s central region, built his career in tobacco companies. Before becoming a sector lobbyist, he was director and production manager at Meridional – which after merging with Dimon originated Alliance One International, one of the largest tobacco exporters in the world.
His participation in SindiTabaco happened when he was still clocking in at the factory. In 2006, just one year after the ratification of the Framework Convention, he took over as president of the union financed by the largest cigarette companies, a position he still holds. “He’s like a conductor who coordinates strategies among different entities, especially those connected to farmers and industry workers”, says Alexandre de Carvalho, from Inca.
Like Sandi, Iro Schünke moves around the corridors of power bearing different titles, displaying military medals on his lapel. He is also CEO of the Crescer Legal Institute, linked to SindiTabaco and focused on training new tobacco growers, director of the Rio Grande do Sul Industry Federation (Federação das Indústrias do Rio Grande do Sul -Fiergs) and has a permanent seat on the CNI and the National Agriculture Confederation (CNA), as well as on the Sectorial Chamber, where the lobbyists meet. In addition to traditional business associations, he takes part in events within the constellation of entities that promote pro-cigarette arguments, such as ETCO and the National Forum to Combat Piracy – the executive president of ETCO, Edson Luiz Vismona, also directs the projects at FNCP.
During the four years of the Bolsonaro government, the SindiTabaco agendas led by Schünke gained space and following in the Executive Branch. The federal government delivered the hardest blow against the Framework Convention, which culminated in the dissolutin of Conicq as revealed by Joio. While the lobbyist for former Souza Cruz, Delcio Sandi, pressured Anvisa to give the green light to electronic cigarettes and the Ministry of Economy with the tax agenda, Schüncke was busy ingratiating himself with the Ministry of Agriculture led by Tereza Cristina.
One example of this approximation, marked by mutual empathy, was the meeting in February 2019, right after Jair Bolsonaro’s inauguration, in which the representative of the 14 tobacco corporations appears beside the quartet, Benício Werner, Romeu Schneider and Carlos Galant in the minister’s cabinet. The host was Fernando Schwanke, another politician from the Rio Grande do Sul tobacco industry, the former mayor of Rio Pardo (RS), who took on the Office for Family Agriculture and Cooperativism within the ministry.
Appointed by another gaúcho [from Rio Grande do Sul], federal representative Alceu Moreira from the MDB party, one of the staunchest pro-tobacco voices, Schwanke became the main voice for the demands of the group from the Sectorial Chamber of the Tobacco Production Chain at Mapa. He took office saying that that he would turn the integrated production system between tobacco farmers and the industry into a model for other agricultural sectors.
At the meeting, Iro Schünke felt free to vent his anger. He said he felt “attacked” – a recurring complaint within the lobby group, who defends itself by bringing up data on the sector’s economic importance and repeating that the activity is legal. According to him, the minister and the secretary ensured that “this ‘ideology’ would no longer exist”. “Activism against tobacco production is water under the bridge”, confirmed Schwanke to the Agrolink portal. Coverage of the meeting leaves no doubt that the lobbyists were feeling well at home during the Bolsonaro administration.
This proximity led the Ministry of Justice to create a working group in 2019 to consider reducing cigarette taxes, but that didn’t move forward. Another blow was Anvisa’s decision to maintain the ban on ESDs in 2022 after a series of hearings and closed door meetings bringing together the main names in the lobby.
Upon taking on his sixth term as the head of SindiTabaco last year, Schünke reaffirmed his objective to keep working on “regulatory issues” and to “afford visibility” to the sector. “To increase the importance of tobacco beyond what it represents is one of the strategies the industry has always used”, Carvalho describes. Exalting the strength is always accompanied by the numbers of jobs created: “600 thousand in the field and 40 thousand in the factories”, said Schünke at the meeting with Minister Tereza Cristina.
Data from the Ministry of Labor and Social Security indicate that in 2022 tobacco factories in Brazil employed 12.6 thousand people. In rural areas, statistics from Afubra itself tell another story. The sector has been shrinking in Brazil since 2004, in terms of cultivated area, production and families involved. Since then, the number of tobacco growers has decreased by 31%, and production has shrunk by 27%. In the 2021-22 harvest, the cultivated area was 9.8% less than the previous year in the Southern region, the national center for this culture.
We contacted Iro Schünke in order to understand the relation between the entities in defense of the sector and the fall in production and jobs, but received no answer.
Among experts, the consensus is that the drop in demand has to do with worldwide efforts to reduce smoking. In the last 20 years, prevalence has dropped from 32% to 22% of the population. Soon, it is possible that the impact will be even greater, owing to the advance of electronic cigarettes, which use zero or very little tobacco. That is actually one of the main tobacco lobby flagships in Brazil today: to force Anvisa to give the go-ahead for the sale of these products, prohibited in 2009 and reconfirmed in 2022.
The defense of electronic devices has dominated most of the meetings attended by lobbyist Delcio Sandi in the last five years in Brasília. But it also concentrates the focus of Iro Schünke, who despite wandering around the federal capital, maintains the focus of his activities in the Southern region, which accounts for 95% of the country’s tobacco production.
That is where SindiTabaco co-opts entities such as Afubra and Stifa, who in theory should be on the side of the tobacco farmers, but show up in the tobacco lobby constellation side by side with SindiTabaco, Abifumo, Amprotabaco and supporting institutes such as ETCO and FNCP.
Created in the 1950s, Afubra holds the presidency of the entity that is the tobacco lobby meeting point: the Sectorial Chamber at Mapa. In an interview given to a Santa Cruz do Sul radio station in 2016, its president Benício Werner said in a calm and shaky voice that the numbers relative to the growth in the electronic cigarette market “are very scary”. But in the minutes of the Chamber meetings analyzed by Joio, this concern is not expressed by Werner or Schneider before their colleagues in the industry – even though it may represent a knockout punch for the almost 130,000 families that make up the association.
Not even the National Program for the Diversification of Tobacco-cultivated Areas (Programa Nacional de Diversificação de Áreas Cultivadas com Tabaco – PNDACT), a demand made by entities such as Afubra to the Brazilian government at the time the treaty was ratified, is mentioned at the meetings. The examples of diversification are limited to the “lesser crops”, corn and bean plantations grown between tobacco seasons, supported by the tobacco companies. Attempts were made to contact Werner, but no answer was given either.
In his fourth term at the head of Afubra, Werner does not conceal his proximity to the industry. When questioned in an interview after his last election with regard to Afubra’s position in the production chain, he said “(we are) with the partner entities, unions and federations, not only concerning field production, but also the workers in the industry, with the actual representation of the industries.”
