subregional workshop on the trade and environment dimensions in the food and food processing...
TRANSCRIPT
Subregional Workshop on the Trade and Subregional Workshop on the Trade and Environment Dimensions in the Food Environment Dimensions in the Food and Food Processing Industries in and Food Processing Industries in South-East and North-East AsiaSouth-East and North-East AsiaJakarta, Indonesia, 26-27 July 2006Jakarta, Indonesia, 26-27 July 2006
Lorenzo SANTUCCIUnited Nations Economic and Social Commission for Asia and the Pacific (UN ESCAP)
Environmental and Health Environmental and Health Requirements and Market Access Requirements and Market Access
for Food Products from South-for Food Products from South-East and North-East AsiaEast and North-East Asia
Overview of presentation
• Nature, types and trends in environmental and health-related requirements
• Constraints faced by developing countries in meeting requirements
• Opportunities and benefits arising from adjusting to environment and health-related requirements
Types of Environmental and Health-related requirements
• Environmental and health-related requirements are of different types and nature and are set to fulfill different objectives
Type
Product-related
Process-relatedProduct-related PPMs
Non product-related PPMs
NatureMandatory (Legislative)
Voluntary (Non-legislative)
Set byGovernment
Private Sector NGOs
ObjectiveHuman, animal, plant health
Environmental protection
Types of Environmental and Health-related requirements (2)
Examples:• Maximum Residue Levels (MRLs) for pesticides,
aflatoxins, antibiotics, etc• Ban of substances, including pesticides• Hygene/quality control throughout the production chain
(HACCP, Quality and Environmental Management Systems)
• Supply chain management and traceability• Packaging regulations• Eco-labels (e.g sustainable fisheries / forestry products,
organic agriculture)
Types of Environmental and Health-related requirements (3)
Requirements Set by Purpose Example WTO relevance
Legislative market access requirements
Government Protect human, animal, plant health and the environment
MRLs and bans of hazardous substances, packaging regulations
Covered by WTO rules (Fall under SPS / TBT Agreements).
Non-legislative
market access
requirements
(market entry)
Private sector, Government, NGOs
Supply chain management / Environmental and social concerns
Eco-labels, quality / environmental management systems
Not covered by WTO rules (Do not fall under SPS / TBT Agreements)
Trends in Environmental and Health-related requirements
• In recent years there has been an increase in the number, complexity and stringency of environmental and health-related requirements, especially in the food sector
• Major food safety crises (e.g. BSE) have risen the attention of Governments, industries and the general public on consumer health and safety
• Although legislative requirements are mainly related to requirements on end products, there seems to be a trend towards a “farm-to-fork” approach (traceability)
• Industries are playing an increasingly proactive role, setting standards that are stricter than the ones imposed by Governments and that are aimed at protecting consumer health and safety and managing risk through supply chain management
Marketing strategy
Social standards
Trends in Environmental and Health-related requirements (2)
Consumer health & safety
Product
Quality
Environmental protection
Overview of presentation
• Nature, types and trends in environmental and health-related requirements
• Constraints faced by developing countries in meeting requirements
• Opportunities and benefits arising from adjusting to environment and health-related requirements
Constraints faced by developing country producers
• Compliance with environmental and health-related requirements requires several actions (e.g. upgrade of infrastructure and technology; product redesign; changes in procurement strategy; proof of compliance)
• Producers in developing countries face additional difficulties due to a number of constraints, namely:
1. Structural constraints
2. Cost constraints
3. Access to information
4. Standard setting
5. Firm size (SMEs)
Constraints: 1 – Structural constraints
• Lack of infrastructure (e.g. accredited laboratories and testing facilities)
• Certification
• Weak legislative and normative framework
• Limited skills and training capacities
• Limited access to financial resources and cleaner technologies
Constraints: 2 – Costs
1. Adjustment costs
in order to comply with export requirements, changes throughout the production chain and/or alternative inputs may be needed
2. Conformity assessment costs
These include costs for testing, monitoring and certification
3. Cost of non-compliance
These include costs arising from the inability to export caused by restrictions or bans, or by detention of an export batch that fails to comply with import regulations
Constraints: 3 – Access to information
• Accurate and timely information on emerging requirements is essential in order to respond promptly and avoid bans or restrictions to exports
• Insufficient information of both existing and emerging requirements and its dissemination to producers in developing countries is a major constraint
• WTO notifications may not be disseminated promptly• Lack of technical knowledge may prevent understanding
the implications of emerging regulations• Private sector requirements fall out of the scope of the
WTO. Information about emerging requirements may not reach small and medium sized enterprises
Constraints: 4 – Standard setting
• Standards set by developed countries and at international level generally do not take into account the differing environmental, developmental and production conditions in developing countries
• Developing country participation in international standard setting is limited
• Lack of harmonization and mutual recognition and equivalence are major constraints
• Environmental and health-related requirements are becoming more stringent and complex, as new scientific information on health or environmental risks becomes available or new technologies that permit more accurate testing are developed
Constraints: 5 – Firm size
• SMEs may encounter additional difficulties in responding to environmental requirements, as a result of their size
• Proof of compliance, including certification can be difficult to obtain and the cost can be too high for producers to bear
• SMEs cannot achieve economies of scale• SMEs have no or little bargaining power• SMEs often have to cope with lack of institutional
support
Overview of presentation
• Nature, types and trends in environmental and health-related requirements
• Constraints faced by developing countries in meeting requirements
• Opportunities and benefits arising from adjusting to environment and health-related requirements
Opportunities
• Although they can act as trade barriers, environmental and health standards can provide opportunities for improving export competitiveness and address domestic environmental, health and food safety issues. For example: New market opportunities and identification of competitive
advantages Opportunity for investment in supply chain modernization Better quality and safety control practices Increased resource efficiency Improved sustainability of production Improved health and safety of workers and domestic
consumers Opportunity to clarify necessary role of government in
food safety and export competitiveness Opportunity to upgrade legislation
Opportunities (2)
Opportunity Example Improved market access
Improved health and environment
New market / competitive adv
Organic agriculture
Investment in infrastructure modernization
HACCP for fishery products
Better quality and safety control practices
Quality / environmental management systems
Resource efficiency GAP (pesticides, fertilizers, water use)
Improved sustainability of production
GAP / Sustainable fisheries management
Improved health and safety of workers and consumers
Ban on pesticides
Conclusions
• In recent years there has been an increase in the number, complexity and stringency of environmental and health-related requirements, especially in the food sector. These requirements are becoming increasingly important NTBs
• Developing countries face a number of constraints in responding to these requirements
• Environmental characteristics of products and production processes are increasingly influencing product quality and international competitiveness
• Therefore, there is a potential to enhance both export competitiveness and environmental sustainability by addressing environmental requirements for traded products
• Coherent policies that address both these dimensions are needed in order to overcome the constraints and lead to win-win situations
Thank you for your kind Thank you for your kind attention!attention!
Contact:
Lorenzo SantucciAssociate Environmental Affairs Officer
Environment and Sustainable Development DivisionUnited Nations Economic and Social
Commission for Asia and the Pacific (UN-ESCAP)Rajadamnern Nok Avenue, Bangkok 10200 - Thailand
Tel: +66(0)2-288-1946 / Fax: +66(0)2-288-1059E-mail: [email protected]
Web: www.unescap.org/esd