The impact of the sales ban on tobacco products on the price and quantity of
cigarettes, with specific reference to the illicit market
In response to the COVID-19 pandemic, South Africa announced a National State of Disaster
on the 15th of March 2020, with a sudden nationwide lockdown following. Two days before
the lockdown began, the government declared that all tobacco and electronic vaping products
were non-essential items and thus prohibited sales during the lockdown (Filby, van der Zee,
and van Walbeek, 2022). Concerns regarding the danger of COVID-19 transmission from
persons sharing cigarettes/tobacco pipes and organising social events to smoke during
isolation were used to justify the prohibition (Galiatsatos, 2021). Furthermore, smokers are
more prone to suffer major diseases when infected with COVID-19, straining the health
system and taking up virtual space for covid-related patients (CDC, 2020). However, the ban
on these products was controversial, and differing social opinions and behaviours arose in
response.
Those supporting the ban believed it would reduce the strain on the healthcare system by
reducing the number of individuals suffering from smoking-related ailments. Owing to the
lack of cigarettes and high prices implemented by the government, supporters also contended
that the ban would motivate smokers to quit or minimise smoking behaviours, increasing
their overall health and lowering their risk of contracting the virus (Galiatsatos, 2021).
1
, Figure 1 – own drawing
The ban impacted the demand and supply chain in several ways. First, many smokers wanted
to purchase cigarettes despite the ban (Filby, van der Zee, and van Walbeek, 2022). Some
chose to purchase illegally, which increased the demand for smuggled or non-regulated
cigarettes. Due to the scarcity of legal cigarettes to buy and the price rise, several people
reduced their smoking or quit altogether (Filby, van der Zee, and van Walbeek, 2022).
Moreover, additional smokers might have stocked up on cigarettes before the ban,
temporarily reducing demand. (Filby, van der Zee, and van Walbeek, 2020).
The restriction made it difficult for cigarettes to be distributed and produced through the
usual supply routes, significantly affecting the supply curve. This allowed illicit producers to
increase their output to satisfy the demand for illegal cigarettes (Filby, van der Zee, and van
Walbeek, 2022). Factors influencing the demand during the ban included the availability of
illegal replacements, smokers' desire to stop, and the degree of enforcement of the ban. In
addition, the supply was hampered by the disruption of legal distribution channels, the
increase in illegal manufacturing and distribution, and the logistical challenges brought on by
the pandemic (Filby, van der Zee, and van Walbeek, 2022).
2
cigarettes, with specific reference to the illicit market
In response to the COVID-19 pandemic, South Africa announced a National State of Disaster
on the 15th of March 2020, with a sudden nationwide lockdown following. Two days before
the lockdown began, the government declared that all tobacco and electronic vaping products
were non-essential items and thus prohibited sales during the lockdown (Filby, van der Zee,
and van Walbeek, 2022). Concerns regarding the danger of COVID-19 transmission from
persons sharing cigarettes/tobacco pipes and organising social events to smoke during
isolation were used to justify the prohibition (Galiatsatos, 2021). Furthermore, smokers are
more prone to suffer major diseases when infected with COVID-19, straining the health
system and taking up virtual space for covid-related patients (CDC, 2020). However, the ban
on these products was controversial, and differing social opinions and behaviours arose in
response.
Those supporting the ban believed it would reduce the strain on the healthcare system by
reducing the number of individuals suffering from smoking-related ailments. Owing to the
lack of cigarettes and high prices implemented by the government, supporters also contended
that the ban would motivate smokers to quit or minimise smoking behaviours, increasing
their overall health and lowering their risk of contracting the virus (Galiatsatos, 2021).
1
, Figure 1 – own drawing
The ban impacted the demand and supply chain in several ways. First, many smokers wanted
to purchase cigarettes despite the ban (Filby, van der Zee, and van Walbeek, 2022). Some
chose to purchase illegally, which increased the demand for smuggled or non-regulated
cigarettes. Due to the scarcity of legal cigarettes to buy and the price rise, several people
reduced their smoking or quit altogether (Filby, van der Zee, and van Walbeek, 2022).
Moreover, additional smokers might have stocked up on cigarettes before the ban,
temporarily reducing demand. (Filby, van der Zee, and van Walbeek, 2020).
The restriction made it difficult for cigarettes to be distributed and produced through the
usual supply routes, significantly affecting the supply curve. This allowed illicit producers to
increase their output to satisfy the demand for illegal cigarettes (Filby, van der Zee, and van
Walbeek, 2022). Factors influencing the demand during the ban included the availability of
illegal replacements, smokers' desire to stop, and the degree of enforcement of the ban. In
addition, the supply was hampered by the disruption of legal distribution channels, the
increase in illegal manufacturing and distribution, and the logistical challenges brought on by
the pandemic (Filby, van der Zee, and van Walbeek, 2022).
2
