Illicit trade could account for up to 80 percent of vape and e-cigarette sales in the Philippines, undermining legitimate businesses and putting consumers at serious health risk, according to an industry expert.
“There’s a massive discrepancy between exports of e-cigarettes from China and import data in the Philippines. Based on some of the numbers we’ve seen, illicit consumption of smoke-free products in the country could be as high as 80 percent,” said Rodney Van Dooren, a regional illicit trade expert at Philip Morris International (PMI).
Speaking in a recent forum on combating illicit trade organized by the Financial Times in Taguig City, Van Dooren noted that up to 80 percent of locally available smoke-free products, particularly e-cigarettes, could be smuggled. The illicit market for traditional (combustible) cigarettes is around 20 percent in the Philippines, exposing many Filipino consumers to more hazardous products, he added.
“There’s no such thing as a safe cigarette, but counterfeit cigarettes are even more harmful—they are definitely a threat to public health,” Van Dooren said. “Counterfeit products are often made in subpar factories and can contain feces and insects. The carbon monoxide levels of counterfeit cigarettes are more than 130 percent higher, and contain traces of toxins like cadmium and lead.”
Van Dooren said illegal trade has a huge business impact on legitimate companies that follow the rules. “Illicit trade draws consumers away from legal businesses like PMI, affecting both sales volume and pricing.”
He also noted that illegal trade can drive consumers toward cheaper, illicit products and cause significant reputational damage to companies. For example, counterfeit products can have high-quality packaging, making them hard to distinguish from genuine products. “The consumer buys the cigarette pack because the packaging looks good. But independent research has proven that counterfeit cigarettes are even more harmful than genuine cigarettes.”
Illicit trade has significantly increased since the pandemic, partly driven by the growing reliance on online shopping platforms. From around 6 percent before the pandemic, the illicit cigarette market in the Philippines grew to 20 percent, while illicit cigarette consumption in Thailand rose from 5 percent to 28 percent, Van Dooren said.
He lauded the Department of Trade and Industry (DTI) and the Bureau of Internal Revenue (BIR) for doing “a fantastic job” in enacting new laws that strengthen enforcement in combating illicit trade. However, he said addressing the bigger problem requires international cooperation.
“I think that’s a policy issue upstream. Someone’s producing a product that is legal but never legitimate. It’s legal but not legitimate, because there’s no legitimate market where that product can be sold,” he said.
Van Dooren called on countries like India, China, and members of the Association of Southeast Asian Nations (ASEAN) to work together, whether bilaterally or multilaterally, to address a policy gap. “I’m asking ASEAN to reach out to India and China and to bring everybody together to collectively agree that there’s a policy issue, and to not point fingers at each other.”
Van Dooren described the Philippines’ ASEAN chairmanship in 2026 as a “perfect opportunity” for the country to take the lead in addressing the issue of illicit trade once and for all.
