Farmer's Voice

Interview to Stvetan Filev: ITGA Treasurer and President of UNITAB (European Tobacco Association)

Brief CV: Tsvetan Filev is the second-term President of the National Association of Tobacco Growers-2010 (NATG 2010). He was born in the village of Nova Cherna, region of Silistra. He was raised in a family of traditional tobacco growers of North East Bulgaria. He grows tobacco of the Burley large-leaved variety group. His whole professional experience is connected with tobacco growing. In 2016, he is about to graduate from the Higher Education School of Agrobusiness and Regional Development, Plovdiv, Major: Economic Management. Married, with two children.

1.) You have been chairman of Bulgaria's National Association of Tobacco Producers for quite some time. Tell us a little bit about your background in tobacco?

Tsvetan Filev: I will begin my answer to your question by telling you a bit about my background. My parents used to grow tobacco during the 80s and the 90s of the 20th century. They were growing the Burley tobacco variety in Northern Bulgaria. Almost all the memories of my childhood are related to tobacco growing. Bulgaria was then a member of the Socialist bloc of the Soviet Union and when we were 9 or 10-year-old boys and girls, we used to work in the field and that was thought to be normal. When we were 14 to 16-year-olds we were working side by side with the rest of the men and women. This of course was during the school holidays, summer holidays, Sundays and Saturdays or after school. Now it's no longer like this. And mentioning the time when I was at school, it comes to my mind that the families of tobacco producers were able to afford buying their boys two shirts and two pants, as well as two school aprons for their girls, unlike the other families. And that was possible thanks to the tobacco that used to add value to the family budget as an additional income.

In more recent years (2001-2012), when Bulgaria detached itself from the Socialist bloc, many young families began growing tobacco for a living. And the more our country became democratic, the more problems in the tobacco industry grew deeper. All kinds of problems. But the most outstanding were: the state was no longer committed to this field; closing the Tobacco Fund (a structure of the Ministry of Agriculture and Food) toward the end of the period; working under the new conditions of market economy, etc.

Thus it was necessity to create a branch organization, whose main purpose was to defend the interests of the Bulgarian tobacco growers - National Association of Tobacco Producers (NATP-2010). I am not sure why I was elected by the founders of the meeting to be the Chairman of the Association's Board of Directors. As a matter of fact, since the fall of 2010 and until this very moment I have occupied this position, and in 2015, at the General Meeting (GM) of NATP-2010, I was elected for a second term as a Chairman - until the year 2020. For almost seven years now, we have faced challenges, we never thought could exist.

If you allow me, from now on I will also speak on behalf of other people, and I will answer in plural, because we, NATP -2010 and UNITAB, are a team. Our success and failures are a result of the joined efforts of the team.

2.) Congratulations on your election this autumn as president of the European growers association Union Internationale des Producteurs de Tabac (UNITAB). What made you decide to take on the job?

Tsvetan Filev:  Thank you. The position of President of the European Growers Association - Union Internationale des Producteurs de Tabac (UNITAB) is a huge responsibility. I am aware of the fact that besides Bulgarian tobacco growers, the colleagues of Belgium, France, Germany, Greece, Hungary, Italy, Poland and Spain also have expectations and have put their trust in us. At some point Croatia and Romania will join us. Switzerland is a member of UNITAB but the country is outside the European Union (ЕU). In fact, things there are much better. I wish EU countries such a development in the tobacco industry, too.

So, what made me take this position? I will take the liberty of correcting you on this. No one had personally offered or persuaded me to take this position. It is the statute of UNITAB that gives the opportunity when becoming a host country of the Congress (The General Assembly - the supreme governing body of the association), to determine its candidate for president, who will take the position from his colleague based on the principle of rotation. What is more important in this case is that a member-county of UNITAB was able to win the right to become the host and then to organize for holding the Congress. And now, one month after the 35th Congress of UNITAB was held in Sofia, I've actually realized what we've achieved. Let's put aside all organizational problems and vicissitudes. I want to underline that the Congress held in Bulgaria was attended by more than 300 delegates from over 10 countries. Preliminary requests showed about 250 participants. It turned out that we have caught the attention and the trust of partners, media, the state and tobacco producers in advance.

How did we get to be a host country for the Congress of UNITAB? This is a long story. I don't know how much time I have, so I will try to be brief…In 2010, alongside with the creation of NATP-2010 in Bulgaria, we heard that there will be some event of tobacco producers in Poland. We found out in 2012 that this was the 32nd Congress of UNITAB and such a congress will be held in Budapest, Hungary, and it will actually be the 33rd Congress of UNITAB. NATP-2010 became a UNITAB member (acquiring observer status) exactly in Budapest in 2012. In 2014 at the 34th Congress in Perugia, Italy, NATP-2010 became a regular member of UNITAB and a decision was taken that the 35th Congress of UNITAB in 2016 will be held in Bulgaria. The team of NATP-2010 has worked really hard for this candidacy. I remember that there were other countries, too, that wanted to be the host country of the 35th Congress. I believe I have succeeded in achieving things, such as talking more about my country, and then with a little bit more respect. And with my energy and activity for reviving the European tobacco production, I really hope to give this spark to every living person that is capable of upholding the tobacco cause.

3.) You were elected to a two-year term at UNITAB. What are your priorities for the organisation?

Tsvetan Filev:  The fact that it is a two-year mandate is in accordance with the Statute of UNITAB. In this connection, I really like this principle: 'It is not important how much you are working but the way you are working!' I believe that priorities for UNITAB should be uniting the rows of tobacco producers in the member-countries; activating the managing cores of the branch organizations; establishing a European Inter-branch Organization; direct contact and active communication with all the European institutions, responsible for the development of the tobacco industry; activating the branch organizations in the countries for communicating with the governments. For sure there will be priorities that will be fixed within the frames of the next Executive Committee (something like a Board of Directors of UNITAAB). I hope that we can schedule one for January 2017 in Paris. And more! I intend to propose to the parties to hold said Executive Committees in smaller time intervals. For example, we will hold one every two months, i.e. a total of six for 2017. I put this in relation to the upcoming debate on the Common Agricultural Policy (CAP) of the EU for the programming period 2021-2027. I specify that Bulgaria will preside over the EU during the first half of 2018, when the final step of the negotiations for the next CAP of the EU will take place.

4.) Tobacco can be grown at lower cost in many places outside Europe. Are there other competition issues facing European growers, and how can these challenges be met?

Tsvetan Filev: This is true. Specifically for the oriental variety groups of tobacco that are grown in Greece and Bulgaria, their natural competitors being Turkey and Macedonia. Altogether in the four Balkan countries, ¾ of the oriental tobacco worldwide is grown. Tobacco in Turkey and Macedonia is not at any lower cost in comparison with the tobacco of Greece and Bulgaria but there are national funding plans functioning in the first two countries, different from those in the second two. They can decide individually what measures they could take in the state and the sectoral policies in order to develop the tobacco industry. In the EU countries, strategic decisions for the development of a certain sector or its destruction are taken by the European institutions (EP, EC, and Council).

For the Burley tobacco variety, tobacco growers from Europe face a fierce competition by Latin America and Africa. For example, in Malawi, during the 2015 economic year, production amounts to 168000 tons, and for 2016, it is 165000 tons. And this is tobacco having significantly lower cost per 1 kg than the European one, due to lower labor cost. Burley in Brazil, for 2014/2015, accounts for 84000 tons, and for 2015/1016 - 63000 tons.

For Virginia variety group, for 2014/2015 in Brazil, over 603000 tons were produced, and in 2015/2016 - 456000 tons. In India a total of over 797000 tons of tobacco was grown in 2015. And the labor cost is lower than that in Europe, and the tobacco there is at lower cost of manufacturing. And these are only part of the problems that stand before the European tobacco growers concerning the competition that is faced by our 200000 tons of tobacco of all variety groups manufactured during 2016 in all the countries of the EU altogether.

There are of course other problems concerning competition face by European tobacco growers. They are related to the Framework Convention of Tobacco Control (FCTC) of the World Health Organization (WHO). From now on, together with the leadership of UNITAB, the member-countries will have to look for a working model to cope with the challenges faced by the tobacco industry. Of course, coping with these challenges, as you call them, requires a lot of work and self-devotion. I think we are prepared for that.

5.) How would you characterize UNITAB's relation to the European Union and what needs to be done to improve ties to the agricultural bureaucracy in Brussels?

Tsvetan Filev:  At this stage, I believe that UNITAB does not have very good relations with the EU. The things that I mentioned about the future priorities of UNITAB and namely the establishment of a European Inter-branch Organization in the tobacco industry, will give more authority to the European tobacco producer.

6.) The EU's Common Agricultural Policy (CAP) has had a major impact on tobacco production since 2004, when the decision was made to abolish quotas and stop paying production subsidies. The EU has not granted any tobacco subsidies since 2010. A system of direct payments to farmers and support for rural development replaced the subsidies. What has been the impact?

Tsvetan Filev:  When numbers speak, the rest is silence. In 2010, there was 400000 tons of tobacco produced in the EU. Now, in 2016, we are talking about less than 200000 tons. This negative development occurred in all countries producing tobacco. For example, let's take Italy, which is the biggest country. In 2010, tobacco production there was about 100000 tons, and now it is no more than 50000 tons. This is the effect of removing the quotas and stopping the subsidies. And when you consider that within the frames of the European Union, there is about 400000 tons of tobacco and tobacco products manufactured every year, this means that for the last 6 or 7 years, the European Union turned out to be an importer of 50 % of the necessary tobacco products. And all this is happening on the background of a bunch of restrictions from FCTC of WHO and the Tobacco Products Directive of the EU. And on top of that, I will mention the tendentious discriminating policies against tobacco (in its entire spectrum) by almost all European institutions.

7.) UNITAB has called for changes in the CAP that recognize the value of smaller farms. What needs to be changed and why?

Tsvetan Filev:  I think that from now on, UNITAB should take a clear well-grounded position for changes in the САР. This position should specify all particularities reflecting the value of smaller farms. I would divide the proposals in two: those concerning the revision of the terms of functioning for the upcoming programming period 2014-2020, and those concerning the next programming period 2021-2027.

8.) Bulgaria has been a member of the EU since 2007. What has membership brought to the country's tobacco farmers?

Tsvetan Filev:  The leading change in the tobacco industry in Bulgaria, after becoming a member of the European Union in 2007, is the functioning in the conditions of market economy. Bulgarian tobacco producers were not prepared for such development. Many of us even today find it hard to cope alone with the new working conditions that are typical for the EU. Over 80 % of the farmers in 2016 are still trying to get some help from the branch organizations of tobacco producers and from the Ministry of Agriculture, as we also used to do within the period 2009-2011. It is about solving problems of any type: concluding tobacco contacts, providing packaging, selling tobacco raw materials, help in case of payment delay and many other problems. This is the support they hope for every year and they still cannot manage on their own, comprising all categories: both small farmers (0.5 ha) and the biggest ones (200ha).

All circumstances mentioned above led to a relative decrease in the farmers employed in this industry, as well as a decrease in manufactured tobacco quantities. Numbers are eloquent enough: in 2009, in Bulgaria, a little bit more than 51000 tons of tobacco (Basma, Kabakulak, Virginia and Burley) were manufactured by 41900 registered tobacco producers; in 2016 tobacco producers are around 16000 or 17000, from which a bit more than 6000 were registered and they have produced about 16000 tons of tobacco from the four tobacco variety groups grown in the country.

9.) Bulgaria belongs to a small group of countries that grow quality oriental tobaccos. Does exclusivity mean the future for oriental is brighter than for burley or Virginia types also grown in Bulgaria.

Tsvetan Filev:  No, it does not mean this. In any case the future of the oriental tobacco in Bulgaria is not brighter than that of Burley or Virginia. Let me tell you why. Half of the tobacco producers in the EU live and work in Bulgaria. And this is so not because we are a big country, but because we are small and have little farms. If in Italy the average farm of a tobacco producer is about 54.1 acres, in Spain - 46.3 acres, in Greece and Poland - about 12 acres, in Bulgaria, the average size of a tobacco growing farm is around 5 acres. And it is exactly the producers of oriental tobacco who are among the most vulnerable farmers with the most uncertain future for the industry development. With a farm of 5 acres, 150 kg of average yield and total annual quantity of 750 kg tobacco, for Bulgarian tobacco producers of the oriental varieties Basma and Kabakulak, growing this crop is related to livelihood and survival for the rest of their lives. Unfortunately, most of them do not even dare to dream about any other kind of living. I really want to change this, I do not want to be frustrated that in 2015 there are 60000 tons of oriental tobacco produced in Turkey, 25000 tons in Macedonia, 22000 tons in Greece, and only 12100 tons of tobacco produced in Bulgaria, and yet it does not have a guaranteed market. In conclusion, as regards oriental tobacco, it is grown in specific areas of the country with sloped and uneven terrain, and the soils are shallow and have low productiveness. And here is the parallel between small-leaved and large-leaved tobacco varieties. For Burley and Virginia, tobacco producers work in much flatter and more fertile areas. They have larger farms. And they grow other crops, not just tobacco. They should have a better sense for organization and sales of goods. It is quite another story whether they are able to achieve it. Of course, for branch organizations and for the state, all tobacco producers are the same, regardless of the tobacco variety they grow. This is the situation in Bulgaria. I will leave it to you to determine which group of tobacco varieties has a brighter future.

10.) In recent years, Bulgarian growers have blocked roads and set fire to their unsold tobacco in a campaign to get more financial support from the government in Sofia. Has this been resolved?

Tsvetan Filev:  In fact, while defending this cause, NATP-2010 has actually achieved something phenomenal. To some extent, we've managed to oppose an injustice in Bulgaria. I did not want to take a position about this issue, but you are provoking me again. This is all about the fact that Bulgarian tobacco growers are the only producers in the entire EU that had never received any European subsidies for growing and producing tobacco. Neither for the programming period of 2007-2013, nor for the present frame of 2014-2020. Our opinion about this issue has always been that there is no such thing as Common Agricultural Policy for them, it is more like a different agricultural policy of the EU. I wanted to clarify this in my answer to your question, because I think that it was not asked correctly. So I will correct you. We, the leaders of the branch organizations in Bulgaria, have always been the organizers of tobacco producers' protests. The reasons of course were various: against commercial operators delaying the start of the tobacco purchase campaign and therefore its conditions gets worse; against certain merchants delaying payments for the tobacco; against inadequate assessment of the tobacco quality to the detriment of tobacco producers; and against cases in which even though there were contracts signed between producers and processing enterprises, the latter would deny purchasing the product for no reason, condemning growers to face family bankrupts. Also protesting in the summer of 2013, blocking major border checkpoints that are important for Europe, we've managed to constrain the EC to include clauses into its regulation according to which Bulgaria has the right to pay to its tobacco growers Transitional National Aid for tobacco (TNA) during the current programming period of 2014-2020 from the state budget. The scheme and the amount of the funds are fixed in this regulation. So there have never been any protests for getting more financial aid by the government in Sofia. What is phenomenal in this case is that actually around 2009/2010, both the state and the EU had given up tobacco funding in Bulgaria, yet as of the end of 2016 the facts are as follows: for six years now the industry has received National Extra Payments for tobacco and it will continue to receive them for four more years.
I must also note that we have worked with five governments and five Ministers of Agriculture, from 2010 until this moment. We have managed to communicate with all of them. We've also had some differences. There is a government crisis in Bulgaria now, and for sure we will have to work with a new caretaker cabinet and a new regular government after that. So everything is dynamically changing, but we, the people from the tobacco industry have enough experience and I believe that we are even obliged to deal with the challenges.

11.) The World Health Organisation (WHO) via the Framework Convention on Tobacco Control (FCTC) intends to reduce world tobacco production by getting farmers to grow alternative crops. What would UNITAB recommend to achieve this goal?

Tsvetan Filev: Most probably you mean art. 17 and art. 18 of the FCTC of WHO. UNITAB has a united opinion about this issue. From now on, the alternative for tobacco has two aspects. The first is growing quality tobacco raw material, and the second is growing tobacco with the lowest possible cost, without this affecting the quality and yields. Of course, we do not agree with the literal FCTC texts about seeking tobacco alternatives without having any scientifically proven alternatives with economic and sustainable overlapping. This issue also concerns the Governments of tobacco producing countries from the European Union, not just tobacco producers.

12.) The FCTC has barred tobacco growers and the rest of the industry from their discussions, most recently at their plenary meeting this November in India. What can UNITAB do to make its voice heard?

Tsvetan Filev: I am personally already a participant, or in other words, I can be linked to two conferences of WHO. In 2014 I was an observer during СОР6 in Moscow, Russia. About ten days ago, I came back from New Delhi, India, where СОР7 2016 was held. If I am not wrong, I was the only representative of UNITAB on both COPs, but I am certain that I was the only one from UNITAB at the meeting in India. Why? I do not know. Usually for attending such an event, you make the organization not weeks or a month before the event but 3 or 4 months in advance. So this is one of the things that I will try to change for СОР8 in 2018, in Switzerland, while I am the President of UNITAB. I even have ideas what we should do so that the voice of the European tobacco producers will be heard by WHO. In India for example, the branch organizations of Bulgaria, Brazil, India, Zimbabwe, Malawi, USA and Portugal, united under the auspices of the International Association of Tobacco Growers [ITGA], had organized a demonstration with the start of СОР7. Authorities impeded its carrying out, so this led to clashes in which several Indian tobacco growers were arrested and beaten. In such a way we have demonstrated in front of СОР7 of WHO, that we are there and we will keep an eye on each one of their suggestions and decisions regarding FCTC. We will be doing the same thing in front of СОР8 in 2018, but before that we will look out for any bad proposals that could be made by working groups about the tobacco industry. A COP is not just the week of the WHO Conference; it also includes two years of work until the time it is held.

I guess that my words will be also read by a large number of tobacco opponents and they will not like the things I say. That is why I want to specifically emphasize that we, the people working in the tobacco industry do not want everyone to like us, especially when we are led by a cause that protects the livelihood of about 65000 European agricultural farmers and assures occupation of about 300000 employees in this industry. This is the motto uniting everyone in UNITAB, without looking for any recognition or liking. Period.

13.) At the UNITAB meeting that elected you president, the group also formulated its concern that WHO is preparing proposals to recommend drastic reductions in nicotine content in dry tobacco, which would impact tobacco cultivation. What is the basis for your concern?

Tsvetan Filev:  Yes, that is true. WHO intended to eliminate slim cigarettes with the help of art. 9 and art. 10 of FCTC imposing a limit on nicotine content in row tobacco leaves of under 0.1%. For the first, I don't understand how slim cigarettes are more harmful than standard ones. For the second, it means 1/10 of the lowest nicotine content that a producer can achieve today through a really deep change in crop practices, by starting to use GMO products. Of course, the latter does not conform to EU practices. Our concern is in this direction. What is good news for the moment is that there is a significant progress for the both examples. Both slim cigarettes and existing standards of nicotine content in row tobacco will stay.

14.) The Trans-Pacific Partnership is an example of a trade pact which excludes tobacco. The so-called carve-out concept is designed to stop tobacco manufacturers from using trade agreements in their fight against tobacco control measures they deem excessive. UNITAB also has gone on record as opposing carve-out clauses. Why?

Tsvetan Filev:  For me, and also for all my UNITAB colleagues, the exclusion of tobacco from international agreements is a pure discrimination against the industry. And you should note that this is offered by people who are not professionals in the field of commerce, agriculture, economy or finance. There is something wrong about that. We don't agree that people who do not have the necessary competence, without consulting the experts in the abovementioned fields, should put tobacco on the border of legality, limiting the connections between the segments in the industry, etc. No! We will fight! We will oppose this!

15.) Bulgarian agriculture was organized into large farming collectives prior to the fall of the Iron Curtain and introduction of open markets. Did this apply to tobacco growing areas, and were there lasting influences?

Tsvetan Filev: I think that I have answered this while answering the previous questions. In summary I will say that tobacco has not remained unaffected by the consolidation into large agricultural collectives before the fall of the Iron Curtain in 1989. And consequences are still felt. In Bulgaria, we still encounter difficulties after the introduction of the free market. In the near future we will need to adapt the Bulgarian tobacco growers to the European principles of functioning, and we should synchronize European tobacco growers with the worldwide trends in the tobacco industry.

It was a real pleasure talking to you. Thank you for your attention!

Tsvetan Filev
President of UNITAB