study of the costs of compliance with export standards in...

The World Bank

Agriculture and Rural Development Discussion Paper

Study of the Costs of Compliance with Export Standards in the Senegalese Fisheries Industry

Papa Ndary Niang

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First printing or web posting: 2005 © 2004 The International Bank for Reconstruction and Development/The World Bank 1818 H Street, NW Washington, DC 20433 Telephone 202-473-1000 Internet www.worldbank.org E-mail [email protected] All rights reserved. Agriculture and Rural Development Discussion Papers is an informal series produced by the Agriculture and Rural Development Department of the World Bank. These papers raise concepts and issues for discussion in the broader development community and describe ongoing research and/or implementation experiences from the Bank. The findings, interpretations, and conclusions expressed herein are those of the author(s) and do not necessarily reflect the views of the Board of Executive Directors of the World Bank, the governments they represent, or the organizations of contributing authors. The World Bank does not guarantee the accuracy of the data included in this work. Rights and Permissions The material in this work is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The World Bank encourages dissemination of its work and will normally grant permission promptly. For permission to photocopy or reprint any part of this work, please send a request with complete information to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, USA, telephone 978-750-8400, fax 978-750-4470, www.copyright.com. All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, World Bank, 1818 H Street NW, Washington, DC 20433, USA, fax 202-522-2422, e-mail [email protected].

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Contents

Foreword............................................................................................................................................................ v

Acronyms and Abbreviations.......................................................................................................................... vi

Executive Summary .......................................................................................................................................... 1

Introduction ....................................................................................................................................................... 3

1. Importance of Senegalese Fisheries Sector ................................................................................................. 4

Role of Fisheries in the National Economy .................................................................................................... 4 Importance of Senegalese Fishery Resources................................................................................................. 4 Exports of Senegalese Fish Products .............................................................................................................. 5

2. Status of Industrial Fisheries Sector............................................................................................................ 6

Prior to Compliance with Standards ............................................................................................................... 6 Current Situation............................................................................................................................................. 6

3. Compliance with Standards in Senegalese Fisheries Industry.................................................................. 9

Institutional Mechanism.................................................................................................................................. 9 Upgrading Referral Laboratories .................................................................................................................. 10 Staff Training................................................................................................................................................ 10 Compliance with Standards in Fisheries Sector Enterprises......................................................................... 10 Assessment of the Costs of Compliance with Fisheries Industry Standards................................................. 12

4. Impact of Compliance with Standards...................................................................................................... 13

Recognition of Credible Competent Authority............................................................................................. 13 Revision of Legal and Regulatory Framework ............................................................................................. 13 Job Creation and Skills Development........................................................................................................... 13 Impact on Product Quality ............................................................................................................................ 13 Impact on Competitiveness and Survival of Enterprises .............................................................................. 14

5. Additional Needs for Maintaining Compliance........................................................................................ 16

Competent Authority Intervention Costs ...................................................................................................... 16 Costs of Quality Assurance in Enterprises.................................................................................................... 16

6. Recommendations ....................................................................................................................................... 19

Strengthening Institutional Mechanism ........................................................................................................ 19 Ongoing Focus on Compliance with Standards by Enterprises and Fleets................................................... 19 New Training ................................................................................................................................................ 19 Promotion of Senegalese Fish Product Label ............................................................................................... 19 Elements of Support Program for the Industrial Fisheries Sector................................................................. 20

Conclusion........................................................................................................................................................ 23

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Appendixes

1 Persons Interviewed 25 2 Methodology Used to Calculate Costs 25

References 27

Boxes

1 Program to build product health control capacities of ACP countries 21 2 AFD program to upgrade Senegalese enterprises 21

Tables

1 Exports of Senegalese fish products, 1996–2001 5 2 Status of enterprises authorized to export fish products to the EU, June 2003 7 3 Classification of enterprises authorized to export fish products to the EU, June 2003 7 4 Enterprises benefiting from the AFD grant by type of activity 12 5 Assessment of costs of compliance with standards in industrial fisheries sector 12 6 Trend of community alerts, 1997–2002 14 7 Institutional mechanism’s quality maintenance costs 16 8 Enterprises included in the survey 17 9 Annual quality assurance costs by type of enterprise 17 10 Quality maintenance costs in enterprises 18 11 Estimated budget for assistance to the industrial fisheries sector 22 A2.1 Assessment of costs of compliance with standards and distribution of AFD grants by area of activity25 A2.2 Costs of compliance with standards by area of activity 25

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Foreword

Food and agricultural trade is the vital link in the mutual dependency of the global trade system and developing countries. Developing countries derive a substantial portion of their income from food and agricultural trade. The emergence of food safety and agricultural health issues and the related tightening of market requirements form challenges to further gains from trade due to the lack of technical and financial capacities of many developing economies.

As part of a joint program between the World Bank’s Agriculture and Rural Development Department (ARD) and International Trade Department (PRMTR), a survey on the Cost of Compliance of exporting developing countries was undertaken. The survey was focused on the supply chains of high-value food products (horticulture, fish, meat, spices, and nuts). The study quantified the costs incurred by both the public and private sectors; identified the coping strategies employed by the various stakeholders in the supply chains; determined the constraints that hinder compliance; examined the structural changes in the supply chain resulting from compliance with the safety standards; and evaluated the impact of these standards on small-scale enterprises and producers. The survey included Ethiopia (animal products), India (fish and spices), Jamaica (nontraditional agricultural exports), Kenya (fish and horticulture), Latin America Southern Cone (animal products), Morocco (fruits and vegetables), Nicaragua (shrimp), Senegal (fish and groundnuts), and Thailand (shrimp and horticulture).

This working paper is one of a series of such case studies that examined the strategies and costs of compliance of the various stakeholders in developing countries with international agro-food standards. This paper was prepared by Papa Ndary Niang with guidance from Gerard Gagnon (Consultant) and Francois Le Gall (AFTS3).

A complementary perspective is provided by the companion series of buyer surveys involving representative importers, brokers, retailers, and distributors in the European Union, Japan, and the United States. This series, in turn, discusses the buyers’ perception of the strengths and weaknesses of their suppliers and describes the assistance and/or interventions offered by the buyers to their developing country suppliers.

The findings and conclusions derived from these country studies are discussed in a synthesis report that seeks to identify possible points of intervention by the World Bank and other donor agencies and to determine the types of technical assistance that would be most efficient and appropriate. It is hoped that the experiences of these exporter and importer countries will provide useful insights to practitioners in the field, and to national and international policymakers in both the public and private sectors.

Kevin Cleaver Director, Agriculture and Rural Development Department

Uri Dadush Director, International Trade Department

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Acronyms and Abbreviations

ACP African, Caribbean and Pacific

ADB African Development Bank

AFD Agence Française de Développement

ASN Association Sénégalaise de Normalisation

BCPH Bureau de Contrôle des Produits Halieutiques BPL Good Practice in Laboratory

CCI Centre du Commerce International

CEPIA Caisse d’Encouragement à la Pêche et aux Industries Annexes

CFA Colonies françaises d'Afrique (French colonies of Africa)

CFAF CFA Franc, currency of Senegal

CIDA Canadian International Development Agency

DOPM Direction de l’Océanographie et des Pêches Maritimes

DPM Direction des Pêches Maritimes

EISMV Ecole Inter-états des Sciences et Médecine Vétérinaires de Dakar

ESP Ecole Supérieure Polytechnique de Dakar

EU European Union

FAC Fonds d’Aide et de Coopération

FAO Food and Agriculture Organization of the United Nations

GAIPES Groupement des Armateurs et Industriels de la Pêche au Sénégal

GDP gross domestic product

GIMES Groupement Interprofessionnel des Mareyeurs Exportateurs du Sénégal

HACCP Hazard Analysis and Critical Control Points

HIDAOA Hygiène et d'Industrie des Denrées Alimentaires d'Origine Animale

ISO International Organization for Standardization

JICA Japan International Cooperation Agency

LAE Laboratoire d’Analyses et Essais

SDE Sénégalaise Des Eaux

SME Small and Medium Enterprises

UNCTAD United Nations Conference on Trade and Development

UNIDO United Nations Industrial Development Organization

UPAMES Union Patronale des Mareyeurs Exportateurs du Sénégal

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Executive Summary

Fishing holds a key position in the Senegalese economy. Its importance is reflected in its contribution to the economic, food, and social spheres. It accounts for 2.3 percent of national gross domestic product (GDP) and 12.5 percent of primary sector GDP. Exports of fish products bring in one-third of the country’s export earnings, and fish provides more than 75 percent of the Senegalese population’s animal protein requirements. Furthermore, fishing occupies 17 percent of the working population.

Very early, an industry took shape to tap the strong demand for fish product exports, particularly to the European market, tied to Senegal by fishery agreements. From a health perspective, quality control management remained uncertain in most enterprises of the fisheries industry, resulting in uncontrolled processes and producing products of widely fluctuating health quality.

The advent of the European Union in 1993 led to the emergence of a series of measures, including Directives 91/493 and 92/48, designed to guarantee the healthfulness of fish product exports to EU countries. These directives emphasize the need for proper technical and sanitary infrastructure and advocate the HACCP approach to prevent all product risks (biological, physical, and chemical) and thereby guarantee the safety of food products destined for the EU market.

This study assesses the compliance of the Senegalese industrial fisheries sector, along with additional needs for maintaining this compliance. It was conducted on the basis of a questionnaire distributed to enterprises and discussions with their managers.

1. Study of the Costs of Compliance

Between 1990 and 1999, compliance with standards cost the Senegalese industrial fisheries sector some CFAF 14.7 billion, of which nearly one-quarter was covered by the AFD grant.1 AFD set up a supporting program designed to help Senegalese companies comply with standards required to continue exporting to Europe.

Compliance has centered on a number of activities:

Upgrading the institutional mechanism or competent authority

Providing equipment to laboratories

Restructuring fisheries sector enterprises

Staff training for enterprises and the competent authority.

These efforts to achieve compliance have had a broad impact:

Recognition of a credible competent authority: the Bureau de Contrôle des Produits Halieutiques (BCPH)

Revision of the legal and regulatory framework governing the sector

Creation of approximately 50 jobs and skills development for technical personnel

1 Currency equivalence: $1 = € 655.957 = CFAF 540.

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Improved health quality of products

Greater competitiveness of enterprises.

2. Assessment of Additional Needs to Maintain Compliance

Overall, annual quality maintenance costs come to approximately CFAF 5 billion, equivalent to 3 percent of average export earnings. In total, the combined efforts of the competent authority and enterprises cost no more than CFAF 50 per kilogram of exported fish and, on average, generate for the fisheries sector CFAF 1,714 in foreign currency.

To produce these estimates, it was necessary to determine the intervention costs of the institutional mechanism, which also hopes to reach compliance with Directive 91/492 on exports of gastropod mollusks. For enterprises, the costs of quality maintenance were drawn from questionnaires and then extrapolated to the entire industrial fisheries sector.

3. Recommendations

Recommendations were formulated in a number of areas:

Strengthen the institutional mechanism by relocating its facilities and by providing its agents with appropriate training on developments in quality control processes (certification, accreditation)

Continue efforts to bring enterprises into compliance, with a major component on deep freezing

trawlers and partly on land-based enterprises

Provide appropriate in-service training to the technical staff of enterprises and laboratories concerning quality control processes, metrological procedures, and new analytic techniques

Promote the high-quality standing of Senegalese fish products by helping 10 or so enterprises move

toward ISO 9001 certification and through accreditation of 3 referral laboratories, with the anticipated effect of encouraging other enterprises in the fisheries sector to emulate their example.

Similar to AFD intervention, which provided funding for efforts to comply with standards in 1996, a grant program for the industrial fisheries sector, totaling an estimated CFAF 7.5 billion, would be greatly appreciated by the industry. Synergy between the programs of different donors and simplification of administrative procedures would increase such a program’s likelihood of success.

However, no assistance program would be viable without taking into account the problems of artisanal fisheries. Apart from the need for sanitary and technical infrastructure, it appears advisable to arrange training and outreach for artisanal fishermen, notably concerning quality standards and responsible fishing practices. In addition, to ensure the sector’s sustainability, the development of aquaculture remains a serious option to be explored.

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Introduction

The sea has long been one of Senegal’s greatest sources of wealth. In addition to playing a crucial role in the economy, the sea underpins civilization itself through long tradition and experience linking the Senegalese people to the sea. As a result, an industry has gradually taken shape to tap the ever growing demand for fish product exports, particularly to the European market, tied to Senegal by fishery agreements.

A series of measures by the European Union, including Directives 91/493 of July 22, 1991 and 92/48 of June 16, 1992, are designed to guarantee the safety of fish product exports to EU countries. Thus, Senegal was forced to abide by the requirements of the world’s leading market for fish product exports. A vast program to foster compliance with standards gave life to the industrial fisheries sector. A series of radical measures were taken, both bold (completely restructuring enterprises, forcefully positioning BCPH as an executing agency) and, in some cases, draconian (suspending or even closing enterprises). The end result was that Senegal was approved to export its fish products to the EU market (Decision 96/355 of May 30, 1996).

This study marks one point in the process of ensuring compliance with standards. The objectives of the study are to:

Assess the Senegalese industrial fisheries sector’s compliance with standards

Determine the impact of such compliance within the fisheries industry

Identify additional needs for better quality control in the fisheries industry to continue to comply with the quality requirements of leading markets (EU and other lucrative markets).

The recommendations emerging from the study should permit the World Bank to clearly identify the technical assistance needs of the fisheries industry to improve its competitiveness in an increasingly challenging environment.

The study first describes the significance of the fisheries sector to the Senegal economy and its current status. It continues with a discussion of how the industry deals with the relevant standards and the consequent impact of compliance. The report then identifies the needs of the industry to be able to comply and recommends several strategies for donor agencies.

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1. Importance of Senegalese Fisheries Sector

Role of Fisheries in National Economy

Since 1986, the fisheries sector has occupied a leading position in the Senegalese economy, ahead of groundnuts and phosphates. Its macroeconomic indicators, all positive, reflect its importance in the economic, food, and social spheres. On average, it accounts for 2.3 percent of national GDP and 12.5 percent of primary sector GDP. Its total business volume is close to CFAF 300 billion, with added value in the amount of CFAF 70 billion. Depending on the year, the fisheries sector accounts for 25 percent to 30 percent of the country’s export earnings and close to 5 percent of fiscal revenue (through fees and financial consideration collected under various fishery agreements with foreign fleets). In addition, fish plays a fundamental role in the food sector, covering more than 75 percent of animal protein requirements of the Senegalese population, whose annual per capita fish consumption comes to 26 kilograms.

This sector is of special importance because of its contribution to job creation. Fishing and fish processing activities provide direct employment to an estimated 160,000 persons, of whom 150,000 are engaged in artisanal fisheries and 10,000 in industrial fisheries (7,000 land-based jobs and 3,000 on board). When indirect employment related to marketing, transport, and vessel repair is included, the total number of jobs provided by the fisheries sector is approximately 600,000. The sector’s work force represents 7.1 percent of the total population and 17 percent of the working population. In other words, 1 of every 6 working Senegalese citizens works in the fisheries sector or related activities.

Importance of Senegalese Fishery Resources

Four groups of resources are harvested in Senegal:

1. Coastal demersals (shrimp, crawfish, octopus, cuttlefish, sole, threadfin, grouper, sea bream). These are the most sought-after resources, since they have the highest market value, specifically for export to Europe. On average, they account for 25 percent of the catch in tonnage, but 50 percent of total landings in value, and close to 60 percent of exports in value. The breakdown of the catch is 55 percent by artisanal fishermen and 45 percent by industrial fleets (trawlers). Today, these resources are showing signs of overfishing, which only exacerbates the particularly severe competition among artisanal fishermen, national trawlers, and foreign trawlers.

2. Bottom demersals (bottom shrimp, hake, scorpion fish, shark, shagreen, angler fish), which account for 3 percent of the catch in Senegal, based on tonnage, but roughly 17 percent of exports in terms of value. They are caught by industrial fleets.

3. Coastal pelagics (sardinella, mackerel, horse mackerel), which account for 70 percent of landings in terms of tonnage, but only 35 percent in terms of value. These fish are consumed fresh or after fermentation and drying, mainly in national markets and, increasingly, for export to other West African markets. They are caught primarily by artisanal operations, sardine boats operating in Senegalese waters, and pelagic trawlers, mostly foreign.

4. Deep sea pelagics (tuna, swordfish, sailfish). These species travel throughout the tropical Atlantic between the coastlines of Africa and America. Deep sea fishing in Senegalese waters is highly seasonal, reflecting the movements of schools of fish. On average, landings from deep sea fishing

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account for 4 percent of total tonnage, and 6 percent of value. Some 60 tuna boats operate in Senegalese waters, only 2 of which are not foreign. They mainly supply factories that produce canned tuna for export.

Exports of Senegalese Fish Products

Fisheries sector operators are for the most part grouped into three trade organizations: GAIPES (Groupement des Armateurs et Industriels de la Pêche au Sénégal), UPAMES (Union Patronale des Mareyeurs Exportateurs du Sénégal), and GIMES (Groupement Interprofessionnel des Mareyeurs Exportateurs du Sénégal).

Senegalese exports grew steadily from 1994 to 1999 (table 1). The 1999 boom in terms of tonnage was exceptional and largely a result of the massive arrival of octopi in Senegalese waters. There has been a fall-off in exports since 2000, no doubt due to a number of factors: the increased scarcity of certain resources, pernicious and insidious effect of El Nino, and underproduction and financial sluggishness of certain enterprises.

Table 1. Exports of Senegalese fish products, 1996–2001 1996 1997 1998 1999 2000 2001

Tonnage 107,080 112,157 109,488 124,338 88,020 87,032

Value in CFAF M 158,844 165,971 174,196 185,435 186,263 181,142

Breakdown by type of product (%)

• Fresh 11 11 11 9 13 15

• Frozen 64 64 66 78 72 75

• Canned 18 17 16 10 10 7

• Processed 7 8 7 3 5 3

Amount exported to Europe (%) 59 55 59 54 58 82

Source: DPM.

Overall, Europe absorbs some 60 percent of Senegalese exports, followed by Africa with 30 percent and Asia with 10 percent. The North American market is not yet significant (less than 2 percent).

Demand for fish products will only increase as a result of the dietary benefits attributed to fish, as well as the recent mad cow incidents. European consumers have turned increasingly to fish product consumption, which provides good opportunities for Senegalese fisheries sector enterprises that comply with this market’s requirements.

Generally speaking, the three principal markets of North America, the high-purchasing-power countries of Asia (Japan, Korea), and Europe will continue to generate demand for fish products. These markets will experience growth in terms of value (not tonnage) as products are developed with higher added value and rare products are sought. However, the increase in world demand for fish products will continue to be substantial in terms of tonnage in markets such as Africa, Eastern Europe, and Latin America, and the low-purchasing-power countries of Asia.

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2. Status of Industrial Fisheries Sector

Prior to Compliance with Standards

Until December 1993, the industrial fisheries sector comprised 50 or more enterprises with highly variable profiles: three tuna canning factories, several dozen wholesale exporters,2 a dozen or so large enterprises with transformed products, and several dozen small filleting operations. Some fleets with deep freezing trawlers exported their catch directly, particularly shrimp and fish destined for the African market.

Devaluation of the CFA franc in January 1994 had a particularly significant impact on the fisheries sector. The change in price structure following devaluation had the immediate and lasting effect of stimulating exports, which rose from 80,000 tons in 1993 to 112,000 tons in 1997, an increase of 40 percent. For the transformed products industry, this devaluation resulted in improved competitiveness and the restoration of operating margins, spurring the creation of new enterprises. However, this industry primarily targets coastal demersal species, which are subject to both resource limitations and direct export competition. This situation led rapidly to supply problems, as quantities were insufficient and prices too high for profitable use of the processing capacities that had been installed. Many enterprises have had financial problems ever since.

With respect to health issues, exports to foreign markets were governed by the Codex Alimentarius and, in particular, French standards. Certain aspects of sanitary infrastructure were lacking: staff and product channels were not always well defined. There was no systematic separation of clean and unclean areas. Locker rooms and bathrooms, if they existed at all, were insufficient in number, inadequately separated, and difficult to clean. Washbasins were not installed on a widespread basis. There was no systematic treatment of water or ice before using it in processing. Only 10 of the 50 enterprises had quality control officers. Enterprises did not have a true quality control process based on the Hazard Analysis and Critical Control Points (HACCP) method. There were gaps in formalizing practices, and, apart from these 10 or so enterprises, there was no staff training or outreach plan concerning food hygiene. Control mechanisms focused primarily on the finished products (a posteriori) without anticipating deviations. There was no special management of waste. All these deficiencies, taken as a whole, resulted in questionable quality of exports, along with frequent contamination (bacteriological or chemical) of products that were either destroyed at border stations or returned.

Current Situation

Fisheries Sector Enterprises

As of 2003, 23 enterprises had suspended operations for various reasons (insufficient supply, cash flow problems). Currently, the Senegalese fisheries industry authorized to export fish products comprises 69 enterprises and 41 fleets (table 2), including 119 deep freezing trawlers and 2 tuna boats. It also encompasses 2 artisanal processing operations and 1 refrigerated warehouse. The fabric of authorized enterprises and fleets is further characterized by a profusion of small and medium enterprises (SMEs) (more than 50). 2 Enterprises dealing in fresh or frozen whole fish.

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Table 2. Status of enterprises authorized to export fish products to the EU, June 2003

Type of activity Number of active

enterprises Number of inactive

enterprises Transformed products 13 6 Canning factories 3 1 Ice plants 1 - Refrigerated warehouses 1 - Wholesale fish trade 49 16 Artisanal processing 2 - Total number of land-based enterprises 69 23 Fishing fleets 41 fleets (comprising 119 deep freezing

trawlers and 2 tuna boats) Source: BCPH 2003.

With respect to regulatory compliance, the classification of active Senegalese fisheries sector enterprises reveals a large number of enterprises in which quality continues to fluctuate and compliance with standards remains incomplete (table 3).

Table 3. Classification of enterprises authorized to export fish products to the EU, June 2003

Category Number of active

enterprises A* 5 B 7 C 57 D - Source: BCPH 2003. * Category D operations are not authorized. Category C operations are inspected twice as frequently as Category B operations, which are in turn inspected twice as frequently as Category A operations. Category A operations have land-based facilities that are in compliance. Category B operations have certain deficiencies that do not compromise product quality.

The number of fishing vessels in full compliance with standards is 2 tuna boats and only about 20 deep freezing trawlers.

For the most part, exports of fish products are regulated by European Directives 91/493 and 92/48. In other importing countries (Canada, Japan, United States), the standards in effect in these countries are enforced. A look at health issues in the industrial fisheries sector reveals an industry operating at two different speeds. One group of enterprises is firmly rooted in a culture of quality control and is constantly in search of further improvement. Another group of enterprises exercises no real quality control. Parallel to this situation, growth of the industrial fisheries sector is compromised by the obsolescence of the fleet: the average age of vessels exceeds 30 years. The difficulties for deep freezing trawlers stem from the high capital cost of rehabilitating this fleet and bringing it into compliance with standards.

There is good quality control in the canning industry. However, these enterprises still suffer from insufficient productivity and difficulties in containing supply costs. Canning factories are currently in serious difficulty. Both Pecheries Frigorifiques Du Senegal and Condak have embarked on strategies to diversify their products.

There is fairly good quality control in the frozen products industry. However, recurrent quality control problems, as confirmed by the proliferation of cases of noncompliance (microbiological or chemical) and

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irregularities in metrological specifications, are indicative of deficient quality control over time. Investments to ensure compliance with standards and implementation of the HACCP approach remain incomplete.3

Only three enterprises are ISO certified.4 One fishing fleet, Sopasen, comprising 19 deep freezing trawlers, has adopted an original approach to product certification to crown the Adrien Group’s presence of more than 30 years in Senegal: the Red Label for Senegal’s tropical shrimp.

With respect to enterprises specializing in fresh products, professionals are concerned about the unavailability of air freight and the lack of refrigerated facilities at the airport, creating a break in the cold chain. This infrastructure gap could explain why some operators specialize in exports of whole fish, a less risky endeavor. Highly lucrative exports of fresh transformed products (which command high prices and require cash payment in advance) present substantial health risks because of incomplete quality control and, in particular, less than rigorous implementation of the HACCP approach.

Competent Authority

Senegalese legislation is equivalent to European Community legislation and BCPH (Bureau de Contrôle des Produits Halieutiques) is the competent authority.

The most recent mission of European Veterinary Committee experts in 1999 led to the following recommendations concerning the competent authority:

Improve the procedures for authorizing and suspending operations

Upgrade official oversight of production and transport conditions

Improve surveillance plans for monitoring the rate of fish product contamination by heavy metals and pesticides

Arrange nonfalsifiable documents (for example, health certificates)

Institute a water and ice potability program that meets European standards.

Remedial action has since been taken to correct these deficiencies.

On the other hand, Senegal has not yet been authorized by the Standing Veterinary Committee to place bivalve mollusks (Directive 91/492 of July 15, 1991) or fish meal (Directive 90/667/EEC) on the EU market.

Referral Laboratories

BCPH is supported by two referral laboratories for organizing inspections and control. The HIDAOA laboratory of EISMV and the LAE laboratory of ESP perform microbiological and physicochemical analyses, respectively. These laboratories each have a quality control officer but are not yet accredited or authorized by BPL (Council Decision 89/569 of July 28, 1989).

More generally, it should be noted that there are metrological problems (concerning the reliability of weights and measures) at all levels of the industrial fisheries sector (enterprises, BCPH, laboratories).

3 HACCP (Hazard Analysis and Control of Critical Points) is a systematic approach for: identifying the hazards

(biological, microbiological, physical, chemical) associated with producing, processing, and distributing a food product; assessing their severity and the probability of their occurrence; identifying the necessary means to control these hazards; and ensuring that the means of control are implemented effectively and efficiently.

4 Sénégal Pêche (a transformed products enterprise) certified ISO 9002 since 2000, Socofroid (the sole refrigerated warehouse) and Ikagel (a transformed products enterprise) both certified ISO 9001 version 2000 during 2002.

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3. Compliance with Standards in Senegalese Fisheries Industry

Europe absorbs 60 percent of Senegalese fish product exports and is thus the leading export market for the Senegalese fisheries industry. In 1993, with the advent of the European Union, new health regulations, applicable to all member countries, were ratified. The focal point of the regulations involved publication of Directives 91/493 and 92/48. These directives bear on the absence of harmlessness in food products offered to consumers. They require that:

Fish imported into EU territory from third countries must be subject to the same production and health control requirements as products produced in EU member countries (principle of equivalence).

Any third country that wishes to export to EU countries must:

o Have a competent authority that is capable of handling health control and guaranteeing that the two above-mentioned directives are enforced. This competent authority should be organized under appropriate laws and possess the authority and human and material resources needed to ensure quality control.

o Take the necessary measures to ensure that export operations upgrade their means of production, processing, storage, and distribution as needed and follow strict rules of hygiene, as well as an appropriate program of internal quality control to guarantee that their products are healthy. Such programs should be patterned on the HACCP approach, the implementation arrangements for which are covered by Decision 94/356/EEC of May 20, 1994.

Following the appraisal mission of the Standing Veterinary Committee of the EU on March 4-8, 1996, the BCPH department attached to the DPM (originally DOPM) directorate of the Ministry of Fisheries was designated as the competent authority for issuing authorizations to export enterprises. Fifty-six export enterprises dealing in fish products and 96 deep freezing trawlers were approved. On May 30, 1996, the Veterinary Commission adopted Decree 96/355/EC, which sets forth the specific requirements for importing fish and aquaculture products originating in Senegal.

The process of achieving compliance with standards involved the institutional mechanism, fisheries sector enterprises, and, secondarily, deep freezing trawlers.

Institutional Mechanism

The institutional mechanism revolves around BCPH. Since 1990, a variety of funding has been provided by French foreign aid agencies (FAC, AFD) and UNIDO to build its capacities. FAC support for BCPH took effect in 1990 with the goal of establishing a reliable quality control service for fish products. A total budget of CFAF 300 million has permitted BCPH agents to receive scholarships for specific training in health control issues within the French quality control agencies.5 In 1997 AFD provided additional logistic resources to BCPH at a total cost of CFAF 20 million.

5 FAC Agreement 182/CD/91/SEN of March 12, 1992.

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Upgrading Referral Laboratories

Under a UNIDO funding agreement, the two referral laboratories, HIDAOA and LAE, received equipment grants valued at CFAF 21 million and CFAF 43.8 million, respectively. The purpose of these grants was to improve the reliability of the analyses performed by these laboratories. The LAE laboratory subsequently received FAC support in the amount of CFAF 24.3 million in May 1999. This additional support enabled LAE to complete its quality control equipment.

Staff Training

Training programs specifically designed for land-based and on-board employees were organized to address the new techniques and work procedures required by EU standards. AFD and FAC provided a financial package of CFAF 200 million to train quality control officers in enterprises and the technical staff of BCPH. These training actions (1300 person-days) focusing on electrical engineering and the cold chain were designed to produce a direct impact on enterprise maintenance and product quality. Other vocational training programs focused on issues of hygiene and the role of the quality control officer, cleaning and disinfection techniques, and cold chain management. Training was also provided on the proper use of laboratory analyses and standardized methods of internal quality control.

UNIDO provided training between 1994 and 1997 to quality control officers and BCPH agents concerning the HACCP approach. With UNIDO support, two guides to best practices were developed to provide better quality assurance for fresh and frozen fish products. The estimated cost of these actions was CFAF 52.5 million.6

Compliance with Standards in Fisheries Sector Enterprises

In large enterprises, compliance with standards has focused on adherence to the general principles of hygiene in the food industry:

Forward motion of the product

Avoidance of any intersection of product movements

Mechanization of load transfers

Separation of clean and unclean areas

Apart from these general principles, compliance has also focused on:

Restructuring technical facilities by:

o Establishing appropriate channels for staff, raw materials, waste, and finished products

o Rebuilding cold storage rooms (better insulation, floor tiles)

o Modernizing cold chain equipment (freezing cabinets, tunnels)

o Developing facilities for refrigerated waste storage.

6 UNIDO/SI/SEN/94/801 Project.

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Improving production processes by:

o Refurbishing processing rooms

o Introducing new equipment and materials (production lines, foam guns for cleaning and disinfection operations)

o Treating the water used in processing by installing a water filtration and sterilization system

o Storing this water in appropriate tanks

Improving hygiene and working conditions by:

o Resurfacing floors and walls

o Installing locker rooms, washbasins, toilets and laundry facilities

o Purchasing trash cans for waste storage

o Providing employees with appropriate work clothes (caps, boots, masks to cover the mouth and nose)

Improving internal quality control of products by equipping in-house laboratories.

In the case of ice plants and refrigerated warehouses, investments have focused on the procurement of ice generators and the rebuilding of water conduits and electric circuits. Thermal insulation of cold storage rooms, procurement of handling and maintenance equipment, and purchases of work clothes for employees have also been done.

Fish wholesalers have improved the cleanliness of their facilities by repainting walls and resurfacing floors and by acquiring modern equipment for storage, handling, cleaning, and disinfection. Some have purchased refrigerated trucks.

As for fishing vessels, major work has been completed on 10 or so trawlers and the 2 Senegalese tuna boats. This work has focused on vessel structure, sanitary and technical facilities (refitting cabins and storage and freezing areas), production equipment (freezing tunnels, plated cabinets, work tables, electronic scales), and maintenance and handling equipment.

The Senegalese fisheries industry received an AFD grant in the amount of CFAF 3 billion in tandem with the effort to bring enterprises into compliance with standards and upgrade the institutional mechanism.7 Very early on, AFD understood the necessity of supporting the Senegalese fisheries industry, because any ban on exports to the EU market would have had harmful repercussions for the Senegalese economy. Twenty-eight enterprises benefited directly from this grant, which was intended to provide partial funding for their efforts to comply with European standards (table 4). The enterprises had to complete all the necessary work in order to receive in return a 30 percent subsidy on investments made.

However, some enterprises, the AFRICAMER company for example, were unable to benefit from the AFD grant8 and had to reach compliance with standards through self-financing or with bank loans.

7 No. 58 269 00 525 0X/ CSN 1017-01. 8 One reason cited by authorities regarding companies that were not selected was AFD’s support of French companies first.

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Table 4. Enterprises benefiting from the AFD grant by type of activity

Type of activity Number of beneficiary enterprises Transformed products 5 Canning factories 3 Ice plants 7 Refrigerated warehouses 2 Wholesale fish trade 4 Fishing vessels 16 (14 trawlers + 2 tuna boats)

Source: AFD.

Assessment of Costs of Compliance with Fisheries Industry Standards

The efforts made between 1990 and 1999 to bring the Senegalese industrial fisheries sector into compliance with standards cost CFAF 14.7 billion in total. AFD and FAC contributed close to one-quarter of this amount. Table 5 provides a breakdown of costs and sources of funding.

Table 5. Assessment of costs of compliance with standards in industrial fisheries sector

Amount (CFAF) Funding source

Institutional mechanism Training of BCPH agents 300,000,000 FAC Logistical support 20,000,000 AFD

Subtotal 1 320,000,000

Upgrading of referral laboratories HIDAOA 21,000,000 UNIDO LAE 68,100,000 UNIDO (64%) and AFD

Subtotal 2 89,100,000

Fisheries sector enterprises Grants 3,016,000,000 AFD Self-financing (subsidized enterprises) 10,054,000,000 Self-financing and/or loans Other non-subsidized enterprises 1,000,000,000 Self-financing and/or loans

Subtotal 3 14,070,000,000

Training of quality control officers HACCP and guides to best practices 52,500,000 UNIDO Cold chain, laboratory analyses, cleaning and disinfection

200,000,000 FAC

Subtotal 4 252,500,000

Total 14,731,600,000

Source: Author’s compilation.

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4. Impact of Compliance with Standards

Recognition of Credible Competent Authority

Senegal was approved after the first visit of the EU Standing Veterinary Committee in March 1996, as ratified by Decision 96/355 of May 30, 1996. This recognition exempted exporters from certain border station controls, since physical control was reduced in favor of document control. Senegalese legislation is now equivalent to European Community legislation except for the EC’s Directive 91/492 concerning mollusks and gastropods.

Revision of Legal and Regulatory Framework

The necessity of compliance with standards made the Senegalese authorities aware of the changes required by European health regulations. A revision of the legal and regulatory framework led to adoption of Law 98-32 of April 14, 1998 establishing the Maritime Fisheries Code, for which implementation procedures were set forth in Decree 98-498 of June 10, 1998. A master plan for the sustainable development of maritime fisheries was instituted. A letter of fisheries sector policy was finalized in December 1999. A national advisory board on maritime fisheries was set up to permit industrial fleets and artisanal fishermen to advance their points of view and receive recognition as sector managers.

Job Creation and Skills Development

Compliance with standards translated into the recruitment of quality control officers and sometimes a multidisciplinary team led by a veterinarian and including fisheries industry technicians and laboratory technicians. More than 50 skilled jobs were created. In addition, skills development for maintenance workers and quality control officers was accomplished through training in cold chain technology, hygiene, and fish product technology.

Impact on Product Quality

Compliance with health standards in the Senegalese industrial fisheries sector was an opportunity for some enterprises to review their sanitary and production conditions. Some were forced to do so under duress, while others were already accustomed to good hygienic practices before the EU was created. Compliance with standards improved the hygienic and sanitary quality of products and gave greater credibility to certain enterprises. Implementation of the HACCP approach reassured customers and created opportunities for some enterprises to work with large distributors (Carrefour, Auchan, Mark & Spencer). However, the sanitary status of transformed products, as indicated by Community alerts registered between 1997 and 2002, experienced an upswing of Community alerts in 2001 due to a weakened surveillance mechanism in certain enterprises and perhaps a loss of vigor in the institutional mechanism (table 6).

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Table 6. Trend of Community alerts, 1997–2002

Year Number of shipments

Number of alerts Causes

1997 9 4 Community alerts and 5 alerts at border inspection stations

Fecal coliforms, salmonella, total flora


Fecal coliforms, salmonella, vibrio cholerae


Fecal coliforms, salmonella, vibrio cholerae


Fecal coliforms, salmonella, vibrio cholerae, presence of histamine


Total flora, salmonella, fecal coliforms, vibrio parahaemolyticus, banned species (tetraodontidae)

2002 4 4 Community alerts Banned species (tetraodontidae), lead, presence of gastropods

Total 55 31 Community alerts and 24 alerts at border inspection stations

Source: BCPH.

Quality control for the water used in processing fish products is another benefit resulting from compliance with standards. All the enterprises have built water storage tanks to avoid problems caused by breakdowns at SDE (interrupted water supply, fluctuating quality). Most enterprises have instituted a system to treat and disinfect water, both for ice-making operations and for washing the fish, facilities, and equipment. Enterprises that have a laboratory perform systematic analyses of water and ice. The only shortcoming observed is that none of the enterprises has a plant to treat wastewater prior to discharging it toward the ocean or into septic tanks.

Attention to waste management and recycling is another positive outcome resulting from compliance with standards. In large enterprises, waste is automatically collected on production lines in plastic tubs, then stored in refrigerated facilities until it is moved to artisanal processing workshops for processing as by-products, or to 1 of the 2 fish meal plants. In small factories, however, storage conditions are more modest.

Impact on Competitiveness and Survival of Enterprises

Reorganization in connection with compliance with standards has had a positive impact on productivity and thus on competitiveness. The mechanization of load transfers, for example, has generated a time-saving effect on production operations, along with redefinition of production channels. The recruitment of quality control officers and the creation of multidisciplinary teams have contributed to the quest for greater efficiency, as quality control officers have helped to identify sources of poor quality and reduce these sources to a very significant degree. As an example, in one company with an annual business volume of CFAF 15 billion, quality control procedures led to a reduction in costs associated with poor quality on the order of CFAF 300 million in a single year. However, the enterprises’ competitiveness in export markets is relatively marginal, because complying with the standards set by the EU market is not a source of added value.

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Unfortunately, compliance with standards has led to the subsequent closing of certain enterprises. The example of Etablissements Amath Gueye in the wholesale fish trade bears mention. In 1996 this company was one of the few wholly Senegalese-owned fisheries sector enterprises to be included on the list of companies authorized to export fish products to the EU. This enterprise is now closed. Such closings are a result of the enterprises’ fragile capital structure and inadequate management methods (no investment plan and no indication of working capital needs). The granting of permission to private individuals to start companies, the growing scarcity of certain resources, and the granting of new fishing licenses to Chinese deep-freezing trawlers all tended to jeopardize the future of certain enterprises.

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5. Additional Needs to Maintain Compliance

Competent Authority Intervention Costs

The costs of maintaining oversight by the competent authority correspond to the sum of labor costs and operating costs. The operating costs are basically funded by the government through CEPIA.

In-service training of staff is very frequently provided through multilateral assistance or by donors, which is also a key element of the challenge to maintain quality. The annual costs of oversight by the institutional mechanism come to CFAF 273 million (table 7). Development of a surveillance plan for water potentially contaminated by livestock (to check for biotoxins, heavy metals, ciguatoxins, paralytic toxins) will enable BCPH to be authorized to export live gastropod mollusks, which are highly valued in the EU market.

For pesticides, BCPH has just approved the Locustox laboratory as a referral laboratory. Funding in the amount of CFAF 6 million is earmarked for this laboratory in the projected budget for analyses (a total of CFAF 21 million for this year).

Table 7. The institutional mechanism’s quality maintenance costs

Category Amount (CFAF) BCPH labor costs 175,343,000 Operating costs 50,000,000

(including 21,000,000 for the official laboratories: HIDAOA, LAE, LOCUSTOX)

Additional training (2 agents/year) 40,000,000 + 3% contingencies 7,960,290 Total 273,303,290 Source: BCPH.

Costs of Quality Assurance in Enterprises

In truth, there are no additional costs borne by operators to meet the requirements of certain customers or distributors. In fact, the additional costs are passed on to the sale price. Generally speaking, such requirements involve:

Healthfulness of the product

Rules of labeling: trade name of the product, license number of the enterprise or deep freezing trawler, date of production, optimal “use-by” date

Traceability

Compliance with trade specifications (weight, grade, product description and packaging)

Special instructions (how to store the product, presence of any additives, type of consumer)

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Implementation of the HACCP approach implicitly covers all these issues. The additional costs can be summarized as the standard costs of quality assurance, most notably:

Wages and compensation of members of the quality control team (quality bonuses)

Costs of practicing good hygiene, corresponding to the costs of cleaning/disinfection products and other consumables (gloves, masks, clothing, boots)

Costs of internal quality control

Costs of official control, that is, BCPH sampling costs and, in the event of a dispute, the costs of additional analyses

Costs of training in quality control

Costs of outside providers if, for example, the enterprise calls on quality control consultants.

The costs of maintaining or renewing certain lines of production or equipment are considered to be part of the enterprise’s operating costs.

To determine the costs for enterprises, a number of enterprises belonging to different subsectors were studied on the basis of a questionnaire (table 8). It was impossible to include refrigerated warehouses, ice plants, and artisanal processing operations. Based on the data collected, an extrapolation was performed to identify the overall costs in active enterprises. Inactive enterprises were not included in these estimates.

Table 8. Enterprises included in the survey

Type of activity Number of active enterprises Number of enterprises surveyed

Transformed products 13 2 Canning factories 3 2 Ice plants 1 - Refrigerated warehouses 1 - Wholesale fish trade 49 2 Artisanal processing 2 - Fishing fleets 41 (with 119 trawlers) 2 (with 24 trawlers)

Source: Author.

Average quality assurance costs for different segments of the industrial fisheries sector are indicated in the table 9. These average costs depend on the production capacity of enterprises, the size of their quality control team, their level of investment, and their quality control culture.

Table 9. Annual quality assurance costs by type of enterprise

Type of enterprise Quality assurance cost (CFAF)

Transformed products 57,471,163 Canning factories 107,013,161 Wholesale fish trade and other* 23,250,000 Trawlers and tuna boats 19,989,694

Source: Survey results. *Refrigerated warehouses and ice plants are placed in the same category as the wholesale fish trade.

These data can be extrapolated to all active enterprises to calculate a total annual quality maintenance cost of CFAF 4.8 billion in these Senegalese fisheries sector enterprises (table 10).

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Table 10. Quality maintenance costs in enterprises

Category Average quality assurance cost

(CFAF)

Number of enterprises

Estimated total cost (CFAF)

Transformed products 57,471,163 13 747,125,119 Canning factories 107,013,161 3 321,039,483 Wholesale fish trade and other 23,250,000 51 1,185,750,000 Trawlers and tuna boats 19,989,694 121 2,418,752,974 + 3 % contingencies 140,180,027

Total 4,812,847,603 Source: Author.

In brief, annual quality maintenance costs approach CFAF 5 billion, which is equivalent to 3 percent of average export earnings (average earnings between 1997 and 2001). Thus, the combined efforts of enterprises and the competent authority do not exceed CFAF 50 per kilogram of exported fish and bring CFAF 1714 to the sector in foreign currency.

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6. Recommendations

Strengthening the Institutional Mechanism

The institutional mechanism suffers from a lack of adequate facilities, particularly in view of its highly strategic role. The facilities are cramped, dilapidated, and not always conducive to work. It would be appropriate to relocate BCPH to give it greater autonomy. The cost of relocation and logistical support is estimated at CFAF 400 million.

The greatest deficiency of BCPH revolves around its agents’ inability to provide enterprises with certain specific services. Agents are not trained in accreditation and certification procedures, and certainly are not prepared to give advice to certified enterprises or to laboratories seeking accreditation. Given the trend toward this type of procedure, training of BCPH agents should be more responsive to demand and made a priority.

There is now a need to establish a fully functional national laboratory for food quality control. This national laboratory could carry out surveillance plans for water potentially contaminated by livestock as relates to gastropod mollusks, similar to other national laboratories in developed countries.

Ongoing Focus on Compliance with Standards by Enterprises and Fleets

Compliance with standards has mainly involved large enterprises and some SMEs. It would be prudent to continue this compliance with standards. Deep freezing trawlers should be the main focus of this program. The dilapidated condition, and even obsolescence, of these vessels affects the quality of the raw material, the performance, and thus the competitiveness of these fishing fleets. The program would involve some 30 enterprises and 100 or so deep freezing trawlers.

New Training

To ensure the competitiveness and sustainability of exports, all actors must be made aware of quality control. It is imperative that the HACCP approach be extended to all wholesale fish traders and deep freezing trawlers. In-service training in quality control (HACCP, ISO 9001 certification, product certification, laboratory accreditation) and metrology should be developed for quality control officers and BCPH agents. It appears that it will be necessary to train laboratory technicians to search for biotoxins if Senegal hopes to be approved for exports of gastropod mollusks.

Promotion of the Senegalese Fish Product Label

Only 3 enterprises are ISO certified. This is a trivial number, given the multitude (69) of enterprises in the sector. In the opinion of some operators, ISO or product certification would generate a 5 percent to 10 percent gain in added value. It would be useful to guide and support collective quality control approaches at the trade organization level and to promote quality control throughout the fisheries sector (product certification, ISO 9001 certification). Until all enterprises are certified, it would be appropriate to assist in

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the certification of 10 or so enterprises. Such actions would have a stimulating effect on other enterprises in the sector.

ASN could lead such efforts in collaboration with BCPH. To that end, it would clearly be to Senegal’s advantage to institutionalize ASN as the sole agent for quality branding. ASN would then function as an apex institution charged with the following tasks:

Overseeing the entire quality control mechanism

Representing international certification and accreditation organizations

Guaranteeing the oversight, quality, and credibility of service providers (national and foreign experts and firms) called on to assist enterprises in quality control matters until quality certification is reached.

Elements of Support Program for the Industrial Fisheries Sector

The lack of any real financial strategy in the Senegalese fisheries industry is a major bottleneck that the sector has always faced. The AFD grant for restructuring the industrial fisheries sector helped significantly to boost the sector’s credibility with the EU. However, this initiative has not escaped criticism. Some operators complain that AFD basically supported French enterprises, even if Senegalese enterprises did benefit as well. The grant helped primarily large enterprises, at the expense of SMEs, although the latter have greater needs and are characterized by a fragile capital structure. Another problem that was noted concerns the requirement that enterprises complete the work of compliance with standards before being reimbursed for 30 percent of their approved investments. Meeting this requirement seriously affected the cash flow of certain enterprises. On the other hand, it is also true that AFD needed guarantees of this sort to be sure that grant funds were not used for other purposes.

Another shortcoming is the lack of coordination among donors in defining an optimal strategy of support for the industrial fisheries sector. In truth, operators have a hard time deciding which programs to follow because they are weary of the multiplicity of similar sector support programs. Consultation among donors (AFD, EU, World Bank) would have the advantage of reassuring these operators while defining a communication approach for informing sector professionals about the existence of such programs. Few operators are informed. Upcoming programs include one that focuses specifically on the industrial fisheries sector. The goal of this program is to build the product health control capacities of African, Caribbean and Pacific (ACP) countries (box 1).

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Source: Author.

On the other hand, the program to upgrade Senegalese enterprises does not focus solely on the fisheries sector, but on some 60 enterprises representing Senegalese industry (box 2).

Source: Author.

Box 2. AFD program to upgrade Senegalese enterprises Length: 4 years Budget: 12 million euros Source of funds: AFD Target country: Senegal (approximately sixty enterprises) Goal: Improve the competitiveness of Senegalese enterprises Program components:

Bring enterprises into compliance with standards Provide training Review the enterprise’s financial tools (working capital needs, investment needs)

Box 1. Program to build product health control capacities of ACP countries

Length: 5 years Budget: 56 million euros Source of funds: EU Target countries: ACP countries with high sustainable export potential Goal: Strengthen fish production and trade capacities in target countries and

facilitate access to the European market. Components:

Institutional support o Strengthen the competent authority

Support for analytic laboratories o Develop waste control and surveillance plans o Train laboratory staff

Support for enterprises o Strengthen the transformed products industry (export-oriented) including vessels o Implement the HACCP approach and conduct health audits o Train enterprise staff o Develop business plans for capital investment o Help identify funding sources for investments

Support for artisanal fisheries o Strengthen artisanal fisheries o Train artisanal fishermen o Provide direct funding for public infrastructure (fisheries-related or social) o Provide revolving credit for small-scale equipment

Support for artisanal fisheries o Develop business plans o Conduct a feasibility study for SMEs.

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Similar to AFD intervention, which provided funding for efforts to comply with standards in 1996, a grant program for the industrial fisheries sector, totaling an estimated CFAF 7.5 billion, would be greatly appreciated by the industry (table 11). Synergy among the programs of different donors and simplification of administrative procedures would increase this program’s likelihood of success.

Table 11. Estimated budget for assistance to the industrial fisheries sector

Enterprises Unit amount

(CFAF) Amount (CFAF)

Source of funds

Grant amount (CFAF)

Institutional mechanism 400,000,000 400,000,000Relocation of BCPH facilities 350,000,000 350,000,000 Donors 350,000,000Logistical support 50,000,000 50,000,000 Donors 50,000,000Upgrading labs 120,000,000 120,000,000LOCUSTOX 120,000,000 120,000,000 Donors 120,000,000Enterprises 15,400,000,000 6,160,000,000Deep freezing trawlers (100) 130,000,000 13,000,000,000 40% subsidy 5,200,000,000Fisheries sector enterprises (30) 80,000,000 2,400,000,000 40% subsidy 960,000,000Training 150,000,000 150,000,000ISO 9001 and 14001 standards 100,000,000 100,000,000 Donors 100,000,000Other (HACCP, biotoxins) 50,000,000 50,000,000 Donors 50,000,000Quality assurance 490,000,000 330,000,000ISO 9001 certification (10 enterprises) 40,000,000 400,000,000 60% subsidy 240,000,000Accreditation of 3 laboratories 30,000,000 90,000,000 Donors 90,000,0003% contingencies 496,800,000 214,800,000Total 17,056,800,000 7,374,800,000Source: Author’s compilation.

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Conclusion

The Senegalese fisheries industry is a driving force of the Senegalese economy. Its dynamic performance has earned Senegal international recognition in the form of authorization in 1996 to export fish products to the European Union.

The current circumstances of the Senegalese fisheries industry reveal an industry operating at two different speeds:

Large and medium-size enterprises that are careful to meet the requirements of the world market and constantly seek further improvements

Other enterprises of more modest means, facing numerous problems (cash flow, variable quality).

This situation calls for responsible decisions to provide a boost to the Senegalese fisheries industry. The fabric of the industry needs to be reworked, by closing down operations that function only hypothetically and by freezing fishing licenses. Senegal’s image and the sector’s sustainability are at stake. It has become necessary to implement a program of support for the fisheries industry based on the three following objectives:

Continue to bring enterprises and deep freezing trawlers into compliance with standards

Upgrade the skills of quality control officers, BCPH agents and referral laboratory staff

Contribute to the development of fisheries sector SMEs (through assistance in financial management, working capital needs assessment).

This program would have a significant impact only if it encourages emulation of enterprises that are in tune with the requirements of foreign customers and distributors. To that end, assistance should be provided to 10 or so enterprises concerning ISO 9001 certification or product certification procedures. The impact would be felt in terms of added value in the sector and increased demand for Senegalese fish products.

Synergy between the programs of different donors and simplification of administrative procedures would increase the program’s likelihood of success.

However, no assistance program would be viable without taking into account the problems of artisanal fisheries. Apart from the need for sanitary and technical infrastructure, it appears advisable to arrange training and outreach for artisanal fishermen, notably concerning quality standards and responsible fishing practices. In addition, to ensure the sector’s sustainability, the development of aquaculture remains a serious option to be explored.

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Appendix 1. Persons Interviewed

Fisheries sector enterprises

AFRICAMER Mr. GABRIELLI, Chief Executive Officer Dr. Sogui DIOUF, Veterinarian Dr. Samba NDAO, Veterinarian, Quality Control Officer

AMERGER CASAMANCE Mr. Anibal Serafin FERNANDEZ SOUTO, General Manager Ms. Fatou NIANG, Assistant General Manager

ARMEMENT BERTHOME Mr. Laurent BERTHOME, Managing Director Mr. Aliou DIEYE, Senior Fisheries Technician, Quality Control Officer Mr. Amadou SY, Chief Accountant

CONDAK Ms. FALL, Quality Control Officer PECHERIES FRIGORIFIQUES DU SENEGAL

Dr. Mamadou NDIAYE, Veterinarian, Quality Control Officer

LA PIROGUE BLEUE Dr. Babacar Sène, Veterinarian, Quality Control Officer

SACEP Mr. Honorino VIDAL, Managing Director Mr. Oumar SAMB, FIDEXKA Firm

SOPASEN Mr. Jacques MAREC, Managing Director

INSTITUTIONAL MECHANISM

BCPH Dr. Mamadou GOUDIABY, Veterinarian, Head of BCPH Mr. Valdiodio Ndiaye, Fisheries Engineer

DPM Dr. Ndiaga GUEYE, Veterinarian, Director of DPM Dr. Papa Namsa KEITA, Veterinarian, Former Head of BCPH

TRADE ORGANIZATION

GAIPES Mr. Douguitigui COULIBALY, Permanent Secretary of GAIPES

INTERNATIONAL INSTITUTIONS

AFD Mr. Didier SIMON, Deputy Director Mr. Pierre FORESTIER, Project Leader

EUROPEAN UNION DELEGATION

Ms. Héléne CAVE, Advisor to the EU Delegation in Senegal

JICA Mr. Hitoshi KANAZAWA, Assistant to the Resident Representative

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Appendix 2. Methodology Used to Calculate Costs

1. Costs of Compliance with Standards in the Senegalese Fisheries Industry

Subsidized enterprises. To determine these costs for enterprises that benefited from the AFD grant, it was necessary to use the information provided by the ad hoc committee of the project on restructuring the Senegalese industrial fisheries sector.

Table A2.1 Assessment of costs of compliance with standards and distribution of AFD grants by area of activity

Enterprises Number Capital costs

(CFAF million) Approved costs AFD grants

Transformed products 5 6,455 3,431 1,029Canning factories 3 6,054 2,518 755Trawlers and tuna boats 16 5,118 2,128 638Ice plants 7 2,304 1,592 478Refrigerated warehouses 2 391 317 95Wholesale fish trade 4 181 68 20

Total 20,503 10,054 3,016

Unsubsidized enterprises. For these enterprises, the following methodology was used to calculate costs:

The figures given on the questionnaires (Fq), plus

The average figures (Fa) for compliance with standards in each area of activity. (These figures were determined on the basis of the numbers given in table AA. For example, for producers of transformed products, the average cost of compliance with standards was X1/5, that is, an average figure for this area of activity.)

The average figure of F = (Fq + Fa)/2 was the amount used for these enterprises.

Table A2.2 Costs of compliance with standards by area of activity

Area of activity of AFD grant recipients

Number (example)

Approved capital costs (X)

Grant funds awarded by AFD (Y = 30% X)

Self-financing or bank loan

(Z = X - Y) Transformed products 5 X1 Y1 Z1 Canning factories 3 X2 Y2 Z2 Ice plants 7 X3 Y3 Z3 Refrigerated warehouses 2 X4 Y4 Z4 Wholesale fish trade 4 X5 Y5 Z5

2. Costs of Quality Maintenance in Trawlers and Fleets

Quality maintenance costs were determined on the basis of several types of information covered by the questionnaire. These costs include:

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Wages of the quartermaster serving as production manager and quality control officer on board ship, along with quality bonuses awarded to the crew

The costs of practicing good hygiene (all actions undertaken for good hygiene: use of gloves, aprons, cleaning products and disinfectants, purchases of crates, plastic food tubs) and the costs of repainting and pest control

Controls: internal controls (commercial quality, health quality) and official controls by BCPH, including the intervention costs of the land-based quality control team

Medical monitoring of sailors (cost of medical appointments and drugs kept on board)

Potable water supply for washing products on board and for the crew’s personal hygiene

Advisory services if the enterprise calls on service providers.

Average costs were calculated on the basis of the figures provided by the two fishing fleets that completed the questionnaire.

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References

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Conseil interministériel sur la pêche et l’aquaculture. 2002. (document non encore officiellement approuvé). Ministry of Fisheries. February.

Cato, J.C., and C.A. Lima dos Santos. 1998. “Costs to upgrade the Bangladesh frozen shrimp processing sector to adequate technical and sanitary standards and to maintain a HACCP program.” NE-165. Amherst: University of Massachusetts.

FAO/ADB. 2003. Appui à l’élaboration d’un plan d’urgence de redressement du secteur des pêches. FAO/ADB technical cooperation program. Rome. January.

Plan Directeur des pêches maritimes. 1998. Vol. 1: Analyse descriptive et politiques et stratégies. Ministry of Fisheries and Maritime Transport. May.

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Henson, S., S. Jaffee, C. de Haan, and C. van der Meer. 2002. « Sanitary and Phytosanitary Requirements and Developing Country Agro-Food Exports: Methodological Guidelines for Country and Product Assessments.” World Bank.

CIDA-Centre du Commerce International CCI. 2001. Sénégal–Grappe sectorielle d’exportation: Produits de la mer–Stratégie et plan d’actions de développement et promotion des exportations. July.

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