1. Background and key issues
While food safety and sanitary and phytosanitary standards (SPS) issues are an increasingly important barrier to ACP countries’ exports of food and agricultural products to the EU, they are also an important constraint on the geographical diversification of exports, including the development of intra-regional trade in food and agricultural products.
In terms of their trade consequences, concerns about SPS and food safety at national, regional and international levels interact in many different ways. Matters regarding the integrity of national SPS and food safety protocols, which allow exports to take place overseas, can lead to barriers to intra-regional trade. SPS and food safety market access restrictions on overseas markets can intensify competition on regional markets, while efforts to harmonise regional standards to facilitate access to international markets, might discriminate against certain national producers and effectively exclude them from official markets.
Against this background, growing importance is attached to establishing cost-effective SPS and food safety control systems, which facilitate regional and international trade within harmonised regional frameworks. However, there are considerable practical challenges to attaining this policy objective. Substantive dialogue structures at the national, regional and international levels often need to be established, to ensure that, in meeting universal SPS and food safety objectives, local production realities are taken into account. Establishing cost-effective food safety control systems requires substantial investment at both the regulatory and operational level, often along the whole supply chain – from farm to fork. However, these additional investment costs can be kept to a minimum if advanced knowledge of pending regulatory or private sector requirements is available, allowing changes to be built into routine reinvestment plans.
Critical to getting to grips with the challenge of meeting evolving food safety and SPS standards are:
- regular access to updated information (through databases, news alerts, etc.);
- mobilisation of the requisite technical and financial resources;
- establishment of improved dialogues concerning food safety and SPS standard setting and implementation.
Key issues identified in the 2012 Agritrade Executive brief on food safety included:
- establishing a better dialogue on private sector food safety standards;
- extending the EU’s evolving approach to minor uses of pesticides to the ACP level;
- ensuring that austerity measures do not disproportionately increase the costs of SPS and food safety inspections carried out on imports into the EU;
- intensifying cooperation against the supply of fraudulent pesticides;
- ensuring that the development of harmonised regional SPS and food safety standards are consistent with production realities across the ACP regions concerned;
- deepening information sharing on evolving official standards;
- ensuring that ‘aid for trade’ support for SPS and food safety measures is deployed within a holistic approach, and addresses the whole supply chain;
- enhancing technical capacities for testing and compliance verification within ACP regions;
- establishing clearly defined time frames for SPS approval processes to which importing countries can be held.
2. Latest developments
2.1 Developments in the EU
The EU’s SPS and food safety policy framework is now largely in place and operational. However, two notable issues emerged in 2012–13:
- the failure to develop operational programmes on plant protection products for minor uses and specialty crops;
- the development of new EU regulations on cadmium contamination levels, which affect cocoa and chocolate products and rice.
In December 2012, following a year-long delay, several EU agricultural bodies appealed for the immediate establishment of “an ambitious plan aimed at setting up a permanent EU programme for minor uses and specialty crops, accompanied by a coherent funding programme”. Arising from the EU pesticide review, it was maintained that the programme should address the lack of affordable alternative plant protection products for a range of crops produced in the EU. This envisaged a discontinuation of approval for a range of products, the demand for which was considered insufficient for warranting pesticide companies to prepare submissions under the revised EU approval procedures.
In terms of the development of new EU regulations on cadmium contamination levels in cocoa and chocolate products, the WTO committee convened in July 2012 to hear the concerns of cocoa-producing countries with regard to proposed new EU limits on cadmium levels. The EC has been monitoring cadmium levels more closely since January 2009, when the European Food Safety Authority concluded that certain groups of consumers were at risk of possible overexposure. This led the EC’s Expert Committee on Environmental Contaminants to propose that the limits on cadmium in food products be revised.
ACP and Latin American cocoa producers are arguing that the EC’s new regulatory response “threatens their exports and the livelihoods of their small cocoa farmers”. The EU has been asked to “clarify the contribution made by different types of chocolate to weekly or monthly cadmium intakes” and “to work with scientific experts to agree a method of calculating maximum permitted levels”. Cocoa producers have also called for a 5-year transition to the new standards.
The EC has, therefore, declared its willingness to hold discussions – which are now under way – with a wide variety of experts, within the framework of the WTO. A pragmatic approach is being adopted: for example, differentiating between dark chocolate, which has a higher cocoa content and is generally eaten by adults in small quantities, and milk chocolate, which has a lower cocoa content and is typically eaten in larger quantities by children.
This suggests a need for ACP cocoa producers to mobilise scientific and technical expertise to make their case in a manner similar to that of the EU cereal industry. The European wheat industry has already successfully lobbied for the creation of a specific category for hard wheat, which sets a maximum of 0.175mg/kg, deferred for 1 year, falling to 0.15mg/kg (of cadmium traces) after a further 3 years. These levels were achieved through the effective mobilisation of sound scientific and technical analysis (see Agritrade article ‘ Brussels trains its sights on cadmium in cocoa and chocolate’, 9 September 2012).
2.2 Progress in strengthening SPS and food safety control systems across the ACP
Across the ACP countries, considerable effort is being made to strengthen food safety and SPS control and compliance verification systems. However, progress varies from country to country. For example, in the case of Dominican Republic, in April 2011 concerns had been expressed about the dangers of horticultural exporters losing their access to the EU market on SPS and food safety grounds. However, by June 2012, it was announced that the EC was reducing the frequency of inspections of specified Asian-type vegetable imports from the Dominican Republic (from 50 to 25% of all consignments) in response to the successful implementation of measures proposed in the 2008 and 2010 EU Food and Veterinary Office inspection reports. The implementation of these measures at a multiplicity of levels benefited from assistance under the EC-financed Europe-Africa-Caribbean-Pacific Liaison Committee (COLEACP) PIP programme (see Agritrade article ‘ Inspection levels reduced on imports from the Dominican republic’, 16 July 2012).
Progress was confirmed by the subsequent announcement in January 2013 of a 50% reduction in physical checks on aubergine and bitter melon imports from the Dominican Republic. According to the government, this reflected greater confidence in the health and food safety policies being pursued in the Dominican Republic. The extent of progress being made in SPS and food safety issues was illustrated by the launch of efforts to re-establish exports of Dominican meat products to the US and Caribbean markets.
Yet progress is by no means uniform in the Caribbean. In 2010–11, there were increased rates of detection of higher than permitted pesticide residue levels in fruit and vegetables from Suriname imported into the Netherlands, resulting in the imposition of stricter controls by the Dutch food safety authority in May 2012. According to press reports, private sector bodies had long been warning of a possible disruption of exports on food safety grounds, a situation not helped by the destruction of Suriname’s main food safety laboratory in a fire in 2010. This potentially had regional implications, given that Suriname was the chosen location for the Caribbean Agricultural Health and Food Safety Agency. In Suriname poor product quality, a lack of certification to GLOBALGAP standards and a lack of an effective cold store chain all continue to inhibit the development of the fruit and vegetable export trade.
2.3 Meeting new challenges
Across the Caribbean, the need to comply with the 2011 US Food Safety Modernisation Act has led to a flurry of activity to upgrade agro-food products’ standards, including establishing basic food safety and SPS control and verification systems. The Jamaican government has “initiated a comprehensive range of activities spanning many ministries in an effort to ensure that our food safety systems are on par with international standards and best practices”. This action was taken against the background of a September 2012 estimate that up to 80% of Jamaican food exporters to the US were non-compliant with the 2011 US Act (see Agritrade article ‘ Serious food safety challenges face Jamaican exports to US markets’, 6 October 2011).
Efforts under way to strengthen the Jamaican Bureau of Standards, which is the focal point for achieving compliance with the 2011 Food Safety Modernisation Act, include a €2.25-million first-phase EU support programme aimed at improving laboratory capacities. This is to be followed by a second €5 million phase, which will be extended to include support to small and medium enterprises (SMEs) in achieving compliance with international standards.
However, these efforts are likely to be complicated across the Caribbean by the announcement in January 2013 that, only 2 years after the Food Safety Modernisation Act, further US food safety legislation is to be introduced to reduce the incidence of food-borne diseases. The new rules “are tailored to apply only to certain fruits and vegetables that pose the greatest risk”, with processed fruit and vegetable products not being affected. The new rules will apply equally to both domestic and foreign farms and firms.
Certain exemptions to the new rules are provided, including for foreign suppliers. Nevertheless, foreign producers will still be required to meet basic food safety requirements. The new rules are likely to be elaborated and introduced in the coming 3 years, with smaller businesses given a longer period to comply with new statutory requirements, starting from the date of publication of the final rules (see Agritrade article ‘ Further new US food safety rules could set new challenges for Caribbean...’, 11 March 2013).
Evolving standards and technological improvements in their application pose challenges across all ACP countries and have given rise to a several initiatives. For example, the Kenyan Bureau of Standards is developing a new food safety guide, with the aim of boosting food safety and reducing the time frame for approval of food products. It is maintained that the new guidelines will simplify legislation and increase the competitiveness of Kenyan food products. The hope is that once the new food safety guidelines are in place nationally, they could become the basis for broader East African Community (EAC) standards.
The “moving goalposts” phenomenon not only arises from changes in the basic regulatory framework, but also the application of the framework, often in response to technological improvements. For example, in February 2013 it was reported by the Fresh Produce Exporters Association of Kenya that “more than a fifth of Kenya’s vegetable exports to the European market were rejected in January after they were found to contain traces of a banned chemical” dimethoate. This, however, followed a 90% reduction in the permitted level of residues to 0.02 parts per million.
Although the Kenyan Ministry of Agriculture had sought to take immediate regulatory measures to limit the use of plant protection products containing dimethoate, legal challenges from the distributors of the affected products succeeded in overturning the ban (see Agritrade article ‘ New EU maximum reside levels hit Kenyan vegetable exports’, 28 April 2013). This raises the twin issues of the need to consolidate and update national food safety legislation, and the need for flexibility in the application of new standards, particularly where these new requirements arise solely from improved monitoring technologies.
2.4 Regional based approaches to strengthening food safety and SPS control regimes
Regional approaches to food safety are increasingly favoured. Therefore, in July 2012 the Economic and Monetary Community of Central Africa (CEMAC) established an Interstate Committee of Pesticides in Africa (CPAC). This committee is to “evaluate applications for registration and sales of plant protection products”, with applications submitted between 20 July and 30 September 2012 being subject to a “fast-tracked” approval process that was to be completed by the end of 2012. The culmination of an initiative launched in 2005 with the support of the EU-financed COLEACP PIP programme, it promotes a more cost-effective regional approach to pesticide registration and control. Establishing a uniform system of registration of plant protection products is considered necessary within CEMAC to facilitate the development of regional agricultural production to international standards. It is also seen as facilitating the development of local pesticide production for the CEMAC regional market (see Agritrade article ‘ Regional pesticide registration scheme launched in Central Africa’, 9 September 2012).
Similarly, to enhance food safety and facilitate regional trade in grains, the Common Market for Eastern and Southern Africa (COMESA) is proposing to establish an early warning system for contaminated grain. This is to be accompanied by the establishment of mutually recognised national quality assurance certification schemes, underpinned by harmonised sampling and laboratory procedures in food safety analysis across the region. According to a COMESA food science and trade expert, “individual member states are expected to come up with an action plan towards achieving a common standard in food safety testing.” However, this process is not without its problems: Kenyan government officials maintain that while “every effort has been made to ease flow of grains from neighbouring countries”, the government authorities “can never compromise quality standards”. According to the Eastern Africa Grain Council, Kenyan quality standards are a contributing factor to Kenyan consumers experiencing one the highest maize prices in the EAC region (see Agritrade article ‘ Balancing food safety and regional trade in the Eastern and Southern Africa’, 31 March 2012). The process of harmonisation of standards is thus complicated by commercial considerations.
Even more ambitious, in October 2012 the African Union (AU) announced plans to establish an AU-wide food safety authority as well as a rapid alert system for food and feed to prevent the spread of food-borne diseases and facilitate trade in foodstuffs. It was maintained that getting to grips with food safety issues “will not only reduce food losses and increase food availability in the continent, but also promote exports”. The proposed AU-wide food safety authority would be modelled on similar EU structures, but tailored to African realities.
However, a review of the EU experience highlights the scale of the challenge faced. The concerned European bodies – the European Food Safety Authority (EFSA) and European Rapid Alert System for Food and Feed (RASFF) – both operate in support of national policy-making processes and policy implementation and are “primarily a tool to exchange information between competent authorities”. The primary responsibility for food safety remains with national-based institutions and bodies. The major challenge, therefore, is to develop the institutions’ capacity across the whole of Africa, to enable them to operate effectively within a coordinated African food safety framework (see Agritrade article ‘ African Union moves to establish a region-wide food safety network’, 6 January 2013).
The importance to regional trade of SPS and food safety standards harmonisation cannot be underestimated. Analysis from the World Bank maintains that across Southern and Eastern Africa, the multiple different national standards is a “significant impediment to regional free trade”. While this reality lies behind repeated calls for the harmonisation of SPS and food safety standards, World Bank analysts have pointed out the process of harmonisation of standards itself can carry costs, with careful consideration being required to identify the most efficient and cost-effective means of aligning national standards to reduce the costs of trading for all types of producers.
The World Bank analysis identifies three basic types of approach to harmonising standards at the regional level:
- regional harmonisation: arising from the replacement of national standards by common mandatory regional standards;
- equivalency agreements: where countries recognise their respective standards as a basis for trade;
- mutual recognition agreements, involving acceptance of certain aspects of each country’s SPS measures.
The analysis, implicitly, warned against the verbatim adoption of western standards noting that western production conditions, challenges and realities are quite different to those faced in African countries, as are the respective capacities for conformity assessment.
It also cautioned against mandatory standards that reach beyond essential SPS and human health-related issues, since these can impose high costs and systematically discriminate against smallholder farmers.
The analysis suggests that the Zambian approach – which establishes standards that become a reference point for commercial transactions between buyers and sellers, with SPS and public health-related issues being dealt with on a mandatory basis through SPS regulations – can be much more cost-effective in opening up trade and improving producer incomes, while protecting both consumers and buyers.
The World Bank analysis advocates a voluntary harmonisation approach, in view of capacity constraints across the region and the cost-increasing effects of a mandatory approach. However, it recognises that the absence of mandatory standards can allow governments to use SPS and other quality concerns to close borders.
This suggests a complementary need to ensure the transparent application of regional standards to prevent the use of standards as barriers to regional trade. Yet some analysts see the lack of transparent enforcement arrangements as posing particular challenges for reference standards arrangements, while other believe that leaving it to the market to ensure compliance on the basis of commercial transactions offers more effective scope for overcoming capacity constraints.
Overall, given the diverse production systems operating in the Southern and Eastern African region, realism and pragmatism, combined with transparency and accountability, would appear to be the cornerstones of efforts to establish regional standards that effectively facilitate intra-regional trade. This lesson would appear to have a far wider applicability than simply Southern and Eastern Africa (see Agritrade article ‘ Regional standards, production development and trade’, 1 October 2012).
2.5 Emergence of SPS-based intra-regional trade disputes
Not only are divergent SPS and food safety standards an obstacle to regional trade, but they can also give rise to significant intra-regional trade conflicts On 10 May 2011, “Kenya banned Tanzania’s cut flowers from being exported overseas through Jomo Kenyatta airport”, citing phytosanitary concerns and “demanding an official Pest Risk Analysis of one of the flower farms”. Given that Kenyan cut flower exports are over 12 times the volume of Tanzanian exports, maintaining the integrity of national SPS and food safety controls was considered of critical importance. Taking into account the developing marketing cooperation between Kenyan and Tanzanian cut flower exporters, it was not anticipated that the ban would remain in place for any great length of time.
However, despite the submission of the required pest risk analysis and the forwarding of a signed Bilateral Quarantine Agreement by the Tanzanian authorities to their Kenyan counterparts, it took 22 months for the Tanzanian authorities to address all the issues raised in the risk assessment to the satisfaction Kenya Plant Health Inspectorate Services. The ban on Tanzanian cut flower exports via Kenya was lifted on 25 March 2013.
For a time this SPS-based dispute threatened “to worsen the already antagonistic trade relations between the two neighbours”. Tanzanian companies had complained about the imposition of illegal levies on exports of fresh fruit and vegetables to Kenya, despite an acknowledgement by the Kenyan authorities that these should be removed. Meanwhile, Kenyan companies had complained about harsh new non-tariff barriers (NTBs) imposed by the Tanzanian authorities, including packaging standards for edible oils, and strict rules of origin requirements for tobacco products (see Agritrade article ‘ Intra-regional SPS concerns threaten Tanzanian cut flower exports and so...’, 11 March 2013).
A similar situation emerged in the Caribbean in mid 2012 when food safety and SPS grounds were advanced by the authorities in Trinidad and Tobago to prevent the importation of Barbadian milk products. This dispute was resolved through bilateral discussions, with practical steps and time frames being identified for bringing Barbadian products into line with new Trinidadian labelling requirements. It was also accompanied by the tabling of proposals for a food safety and SPS protocol to avert similar future disputes.
This pragmatic approach may well have been facilitated by the launch in July 2012 of a US$9.25 million EU-funded programme to strengthen the CARICOM Regional Organisation for Standards and Quality. Efforts in this area could be of considerable significance, for the dairy dispute is the latest in a range of trade disputes that have plagued regional trade, largely based on food safety, SPS and technical barriers to trade issues. Indeed, analysts have suggested that much of the poor intra-regional agro-food trade performance is related to food safety (especially for fresh foods) and divergent standards (especially for processed foods (see Agritrade article ‘ Food trade dispute between Barbados and Trinidad and Tobago rumbles on’, 3 September 2012).
2.6 SPS and food safety issues key to the geographical diversification of ACP exports
Given the new global trade dynamic, with far higher rates of growth across the developing world than in traditional markets for ACP exports, getting to grips with food safety and SPS issues is critical to the geographical diversification of ACP agro-food sector exports. This is recognised in ACP countries such as Namibia, where in August 2012 a delegation from the Chinese Administration of Quality Supervision, Inspection and Quarantine was hosted as part of the process of opening up the Chinese market to Namibian fish and meat exports (see Agritrade article ‘ Prospects for Namibian beef exports to China’, 4 January 2013).
Across the ACP, however, these discussions are not always so far advanced. For instance, the enormous potential of the Chinese market for Pacific food and agricultural exports was emphasised at the Trade Pasifika exhibition in Fiji June 2012, although the Pacific region’s trade and investment representative to China, Samu Savou, highlighted the complete absence of agricultural export protocols between Pacific island countries and China. Without such protocols no food and agricultural exports can take place (see Agritrade article ‘ Market opportunities identified but action required’, 3 September 2012).
Similarly, in December 2012, while a series of four agreements was signed between the Zambian and Chinese governments, thus nominally expanding duty-free access for Zambian exports to China, it did not include the conclusion of dedicated agricultural export protocols covering SPS requirements and associated administrative arrangements.
This highlights the centrality of concerted private sector and government action to develop agricultural export protocols with China, in order to tap into the enormous market potential for food and agricultural exports, and also applies across advanced developing countries, where growth in consumer demand far outpaces that of OECD economies.
2.7 Commercial and protectionist dimensions of food safety and SPS standards
SPS and food safety controls need to be based on sound science, but policy makers are often subject to other pressures, equally applicable between ACP and non-ACP countries, and among ACP countries. Debates about Fijian exports of ginger to Australia are illustrative of how SPS issues can be subject to commercial pressures. In August 2012, it was announced that following the release of the final SPS risk analysis by the Australian Department of Agriculture, Fisheries and Forestry, Australian import restrictions on imports of Fijian ginger were to be lifted, provided the necessary quarantine criteria were applied. It was acknowledged that the opening of trade would be dependent on the establishment of effective pest controls for “yam scale and burrowing nematode”. The establishment of effective pest controls to meet Australian import requirements is currently being supported under the AusAID Pacific Horticultural and Agricultural Market Access (PHAMA) programme.
However, the Australian Ginger Industry Association is “unhappy about quarantine measures outlined in Biosecurity Australia’s final risk analysis” and is actively lobbying against approval of imports of Fijian ginger (see Agritrade article ‘ Australian ginger market to be opened to Fijian exports?’, 11 November 2012). It has mobilised state level politicians to pressure the federal government to review the SPS approval decision, which is effectively politicising the issue.
This is just the latest in a range of similar SPS-related disputes that have held back the development of Pacific horticultural exports to Australia. According to the CEO of the Nature’s Way Cooperative in Fiji “unrealistic policies and political interference” have played a “huge part in restricting access for local producers” to the Australian market (see Agritrade article ‘ Fijian horticulture exports expanding, but facing market access barriers’, 9 August 2011). The latest ginger case would appear to highlight the difficulties faced in securing real substantive market access in areas where domestic agricultural producers have a market presence.
The situation in the East African Community is a good illustration of how commercial pressures affect intra-regional trade. While efforts move ahead to establish common regional standards for trade in grains, divergent standards continue to block the movement of cheap foodstuffs from surplus areas to deficit regions across the EAC. Traders exporting to Kenya maintain that even where these requirements are fulfilled (e.g. a moisture content of 13.5%, appropriate grain size and the relevant certificate of origin), delays still occur linked to the issuing of certificates.
In the wider COMESA region, SPS measures are routinely being used in Zambia to block dairy imports, although vitamin fortification policies can provide national producers with effective protection against competing imports.
2.8 Harmonisation of standards beyond the ACP
In 2013 processes began in the EU and US for the launch of negotiations on a transatlantic trade and investment partnership. A major focus of these negotiations will be on harmonising and ensuring the compatibility of EU and US rules and regulations on standards, since these are seen as a bigger barrier to trade than tariffs in many sectors. Significantly the final report of the joint EU–US High Level Working Group on Jobs and Growth concluded that any process of EU–US standards harmonisation would carry implications for the global system of rule-making on product standards.
3. Implications for the ACP
3.1 Applying the minor uses and specialty crops approach to the ACP
Within any elaboration of operational programmes to address the lack of affordable alternative plant protection products following the EU pesticides review, consideration should be given to including an ACP component to address some of the affordability problems which are faced by ACP producers.
3.2 ‘Aid for trade’ support on the scientific basis for cadmium controls
There would appear to be a need for ‘aid for trade’ support to assist ACP cocoa producers in mobilising the required scientific and technical expertise to engage in an effective dialogue with the EU on permitted cadmium levels in different chocolate products.
3.3 Staying ahead of regulatory changes and their operational application
The announcement of a further review of US food safety rules and technological improvements, which can lead to the application of stricter measurement standards, highlights the common challenge of staying ahead of evolving SPS and food safety requirements. This suggests a need for more effective dialogue structures, not only on the basic regulatory standard but also their operational application. As with the evolving EU approach to minor uses and specialty crops, it could give rise to special dispensations or deferment of application of new measurement thresholds, where there is no new direct threat to health underlying the changes.
3.4 The current role of an AU-wide food safety authority
Very particular aspects of the EU experience, which is based on the coordination of national food safety authorities and institutions, would appear relevant in developing the mandate, institutional structure and immediate work programme of the proposed AU-wide food safety authority. At this stage the greatest added value of coordinated AU-wide activity would appear to lie in providing assistance in developing the operational programmes of national food safety institutions. Ultimately, however, the success of efforts to promote internal and external trade in verifiably safe food will hinge upon the success of nationally based institutions.
3.5 Supporting a regional SPS and food safety arbitration mechanism
While some intra-ACP SPS and food safety-based trade disputes were resolved in 2012–13, others escalated, demonstrating a need for the creation of regional mechanisms for independent arbitration of SPS and food safety disputes. This potentially constitutes an area for ‘aid for trade’ support, providing the political will exists to pool sovereignty on science-based decision making on SPS and food safety threats. It would also help guard against protectionist pressures exerted over the application of SPS and food safety standards in intra-regional trade.
3.6 Monitoring the implications of the process of EU–US standards harmonisation
The EU–US process of standards harmonisation, which is to be initiated as part of bilateral FTA negotiations, could, in some areas, lead to changes to EU import regulations that ease market access for ACP exports (see Agritrade article ‘ Tightening of Citrus Black Spot controls could pose challenges’, 28 April 2013), although in other areas it could complicate matters for ACP exporters. It is more important for concerned ACP exporters’ associations to monitor the process of EU–US harmonisation of standards to ensure that any changes that could potentially benefit ACP exporters are automatically extended to ACP suppliers (see Agritrade article ‘ Discussions on standards in EU–USA carry global implications’, 4 May 2013).