Features

Promoting trade, protecting health

8 December 2015
ITC News
With increased trade in food and agricultural products comes increased exposure to pests and diseases for which there are no simple, short term solutions, writes Mevin Spreij.

With tariffs on international trade generally being relatively low, market access increasingly depends on a nation’s ability to comply with a wide range of non-tariff measures (NTMs). These are often used by governments to attain of a range of public-policy objectives such as health, safety, environmental quality and other social imperatives.

It is likely that, in an effort to achieve the Global Goals for Sustainable Development Goals, countries will further increase the use of NTMs in coming years. Among them are sanitary and phytosanitary (SPS) measures meant to ensure that food is safe for consumers and prevent the spread of pests and diseases among animals and plants. The World Trade Organization (WTO) SPS Agreement provides rules to ensure that these measures are not misused for protectionist purposes and do not result in unnecessary barriers to trade. Measures must, among other things, be non-discriminatory, risk-based, least-trade restrictive and transparent while complying with other procedural obligations.

The agreement strongly encourages governments to base national measures on international standards, guidelines and recommendations. These have been developed in the joint Food and Agriculture Organization of the United Nations (FAO)/World Health Organization (WHO) Codex Alimentarius Commission (Codex, food safety), the World Organisation for Animal Health (OIE, animal health) and the International Plant Protection Convention, based in the FAO (IPPC, plant health).

COMMON STANDARDS

Adoption of common standards, or harmonization, is an important way to achieve market access and facilitate safe trade. It is also cost-effective because governments need not develop their own SPS measures and it significantly decreases the chances of a country being legally challenged in the WTO. Other benefits of adopting international standards include lower crop and livestock losses; higher production levels; safer food in the domestic market; and enhanced food security and biodiversity.

The Standards and Trade Development Facility (STDF) is a coordination and knowledge platform that supports developing countries, and in particular least developed countries, having difficulties in implementing international standards. In addition to support to develop and implement projects in this area, the STDF raises awareness about the importance of building SPS capacity, mobilizes additional Aid for Trade resources and identifies and disseminates best-practice standards. Previous and ongoing STDF work has focused on ways to identify and prioritize SPS needs and investment options for market access; the use of economic analysis to inform SPS decision-making; public-private partnerships to build SPS capacity; and, more recently, trade facilitation in an SPS context.

Even where SPS measures are justified by the need to protect human, animal or plant health, compliance with these measures can be costly, preventing exporters from achieving access to markets and reduce competitiveness. This is notably so in developing countries.

Much can be gained by governments regularly ensuring that their SPS measures are still fit for purpose and continue to be justified and necessary. In doing so, the implementation of international standards is highly recommended. In addition, governments should make certain SPS measures are applied and enforced efficiently, for instance by improving collaboration with customs at the border. This has the effect of reducing overlap in procedures and requirements; implementing inspections based on risk; ensuring fees that are no higher than actual service costs; and improving transparency. The new WTO Trade Facilitation Agreement will also be highly relevant in this regard.

MEETING COMMON CHALLENGES

Future capacity-building efforts in the SPS area should continue to focus on helping developing countries, including small-scale growers and enterprises, to meet the import requirements of their trading partners, including through public-private partnership approaches. These efforts should be firmly based on the implementation of relevant international standards as and where they exist. Meanwhile, countries should be trained and better equipped to challenge proposed measures of trading partners, notably if the measures are more burdensome than necessary. Trade facilitation programmes provide additional opportunities to improve and integrate SPS border management, thereby reducing trade costs.

Finally, increased trade in food and agricultural products, including within value chains, is increasingly exposing countries to new pests and diseases for which there are no simple short-term solutions. To address these ’structural’ SPS constraints, notably in the public sector, sustained long-term commitment to funding at national and regional level will be required to ensure minimum levels of capacity, with positive knock-on effects on market access over time. The mobilization of the international community to address highly pathogenic avian influenza and hand-foot-and-mouth disease provide positive examples of such initiatives. Similar efforts are recommended in the plant health area, for instance to control fruit flies which seriously threaten agricultural production, reduce quality, disrupt trade and trigger huge financial losses in many developing countries.