The Cost of Compliance with Sanitary and Phytosanitary Measures in Low-Income Countries: A Strategy for Reorganization of the Supply Chain Author: Mehdi Shafaeddin

Publisher: Third World Network (TWN)

ISBN: 978-983-2729-46-4

About the book

In addition to international prices negatively affected by agricultural support measures in developed countries, exports of food products from developing countries run up against a formidable hurdle in the form of sanitary and phytosanitary (SPS) measures imposed for health and safety reasons in importing developed countries. The cost of complying with these often stringent SPS standards is highly burdensome, particularly for low-income countries, while non-compliance would entail a damaging loss of export earnings.

In considering the case of Ethiopia, a large low-income country heavily dependent on agricultural exports, the author of this paper proposes a development-oriented, forward-looking compliance strategy in order to reduce the costs and increase the benefits of compliance. Accordingly, he advocates the reorganization of the export supply chain from farm to port, to create a comprehensive and effective countrywide food safety system comprising vertically integrated farming operations and/or cooperatives in the long run.

The author maintains that such a strategy would, by facilitating compliance with importing countries’ SPS requirements, boost exports of demand-dynamic products to lucrative markets, thereby enhancing export earnings.

About the Author

Mehdi Shafaeddin is a development economist with a D.Phil. degree from Oxford University. He is currently a freelance international consultant affiliated to the Institut de recherches économiques (IRENE), Université de Neuchâtel (Institute of Economic Research, Neuchatel University), Switzerland. He is former head of the Macroeconomics and Development Policies Branch at the United Nations Conference on Trade and Development (UNCTAD) and the author of many articles on development policy issues published in international journals. His latest book is Trade Policy at the Crossroads: The Recent Experience of Developing Countries, published by Palgrave Macmillan. He can be contacted at M.Shafaeddin@gmail.com

Contents

List of tables and charts

List of abbreviations

Preface

Executive Summary

.PART I INTRODUCTION

Chapter 1 Introduction

PART II THE BURDEN OF THE COST OF COMPLIANCE

Chapter 2 Main characteristics of the SPS Agreement

Chapter 3 The need for a complex SPS system and a forward-looking strategy

Chapter 4 The cost of compliance

Chapter 5 The impact of SPS measures on African food exports

Chapter 6 Reorganization of the supply chain

Chapter 7 The cost of compliance: Conclusions

PART III AN ALTERNATIVE PERSPECTIVE ON THE ORGANIZATION OF THE SUPPLY CHAIN IN A LARGE LOW-INCOME COUNTRY: THE CASE OF ETHIOPIA

Chapter 8 Main features of the Ethiopian economy: The importance of agriculture in export expansion

Chapter 9 Elements of a compliance policy

Chapter 10 Applying SPS measures: Organizational issues

Chapter 11 Conclusions

References

Appendix A: Checklist of illustrative SPS issues for consideration in the process of accession to the WTO

Appendix B: Appendix tables