Insider Monkey

Top 20 Countries with the Highest Percentage of Smokers

Ramish Cheema
8 min read

In this piece, we will take a look at the top 20 countries with the highest percentage of smokers. If you want to skip our primer on the tobacco industry and countries that smoke the most cigarettes, head on over to Top 5 Countries with the Highest Percentage of Smokers.

Tobacco smoking is one of the deadliest habits anyone can form. A practice that has been in place for decades if not centuries, smoking contributes to more than eight million deaths around the world each year according to data from the World Health Organization. Most of the world's smokers are men, and as a whole, cigarette smokers accounted for 22.3% of the world's population as of 2020.

Like gasoline, cigarettes are also one category of products that have an interesting demand and supply curve. This curve is used in economics to gauge the impact of price changes on a product's supply, and it generally shifts with the changes in price. Data from Dartmouth University's Tuck School of Business shows that even large price changes often have little effect on the demand for cigarettes.

Naturally, this also provides cigarette companies with an enviable market if you disregard the unethical nature of selling a highly addictive product that can lead customers to a slow and painful death. This lucrative market has also transformed the cigarette industry into one of the largest in the world. In fact, the cigarette industry is one of the few that can rightly be called an oligopoly. And its dominance is clear from the fact that while nearly all other oligopolies - such as semiconductor fabrication, aircraft production, and oil production - all require massive capital investment, the tobacco sector is quite different.

Making cigarettes is neither technologically intense and neither does it require massive capital expenditure such as buying expensive machines made by only one company (like for instance ASML Holding N.V. (NASDAQ:ASML)'s dominance in the semiconductor industry). Despite this, most of the world's tobacco industry is controlled by five companies. These are Philip Morris International Inc. (NYSE:PM), British American Tobacco p.l.c. (NYSE:BTI), Imperial Brands PLC (OTCMKTS:IMBBY), Japan Tobacco Inc. (OTCMKTS:JAPAF), and China Tobacco International (HK) Company Limited (HKG:6055.HK). (For a complete list of best cigarette stocks, be sure to check out 10 Best Tobacco and Cigarette Stocks To Buy) And for these companies, the countries where the most tobacco is smoked are also lucrative markets.

So how exactly do these big tobacco companies play in their markets? Research from the National Library of Medicine shows that at most, a single tobacco company can control 50% of a country's tobacco market. The biggest tobacco company when it comes to dominating the markets of the 90 countries studied is Phillip Morris, which commands the majority of the market in 38 countries. As a whole, one company out of the five held the majority of the market in 77 countries. Delving deeper, the largest market for China Tobacco is naturally China, while for British American Tobacco, the main markets are Australia, Canada, Pakistan, and Brazil. Japan Tobacco commands the market in its home country and Russia among others. And finally, Phillip Morris is scattered throughout Europe, Mexico, and South America.

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