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Standards and Trade: Background/results of the project Veena Jha

Standards and Trade: Background/results of the project Veena Jha. UNCTAD. Geneva, 2-4 October 2002. Sectors. Environmental requirements/SPS measures Key questions. Effects, both positive and negative, on exports from developing countries Constraints, costs of compliance

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Standards and Trade: Background/results of the project Veena Jha

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  1. Standards and Trade:Background/results of the projectVeena Jha UNCTAD Geneva, 2-4 October 2002

  2. Sectors

  3. Environmental requirements/SPS measuresKey questions • Effects, both positive and negative, on exports from developing countries • Constraints, costs of compliance • Perceptions (protection/protectionism) • Responses at national/regional levels • Recommendations to mitigate adverse trade effects and strengthen capacities to respond to these standards (a) national/regional (b) bilateral/multilateral (c) multilateral trading system

  4. Lessons learned • Importance of the standards examined in the market place? • Compliance costs and trade effects • Protection versus protectionism • Regional strategies

  5. Potential problems • Lack of transparency • Complexity of SPS standards • Threshold limits • Standard takers instead of Standard Setters • Relevance of the standard to the production conditions of the exporting countries • Domestic Regulatory Problems

  6. Economic/developmental effects of SPS measures and environmental standards • Compliance costs • Trade impacts • Impacts on industry

  7. Economic/developmental effects of SPS measures and environmental standards • Legislation • Training • Infrastructure • Engagement in international negotiations

  8. Can SPS measures and environmental standards be protectionist? Motivation: • Protecting national producers against import competition? • Creating a market for conformity assessment? • Lowering prices? Perceptions: • Insufficient scientific evidence • Lack of coherence in standards

  9. Africa

  10. Sectors/cases

  11. Perceptions on Implementation of HACCP Standards for fish • Certain standards are not strictly relevant for product quality • Certain standards are too stringent given Indian fishing conditions • The legitimate objectives of standards could be met through less cumbersome and less costly procedures • Indian plants face more stringent standards than European plants (e.g. Indian plants have to undertake 62 tests to check water quality)

  12. Peanuts • Different testing procedures and conformity assessments required in different markets • New sampling plan (3 test Dutch code methodology) would result in higher rejection rate • Experts believe that 75% of the rejected lots would actually fall within the established tolerance limits

  13. Tea (1) • It is alleged that in 1995, German limits of 0.01 mg of tetradifon and 2 mg of ethion per kg of tea were imposed somewhat arbitrarily because of lack of data from India • The Teekanne Darjeeling Gold brand of tea was rejected because it contained 0.24 mg of tetrafidon per kg • No rejections in United Kingdom; most Indian tea firms follow UK principles

  14. Tea (2) • Cost of testing required by Germany: US$ 234 per analysis • Indian standards are more stringent than ISO 3720 standardans other countries’ standards, except Japan

  15. Costa Rica and the TED case • Lack of enforcement capacity and reluctance of fishermen lead to non-compliance. Imported from the US at a cost of $300 each,4 inch (10 cms.) TEDs were constantly obstructed by organic waste.

  16. After the crisis, Costa Rica initiated formal procedures to seek a modification of the TEDs’ proportions. Two important studies were initiated in order to support this petition. • Mid-2000: an increase in the escape holes of 2 inches, for a maximum distance between deflection bars of 6 inches (15.2 cms).

  17. COURSE OF ACTION TAKEN BY COSTA RICA • Engagement in international agreements and certifications programs; • Enactment of national legislation; • Seeking approval by showing commitment to internationally accepted norms • Seeking recognition of differing national circumstances that render US regulations inapplicable by issuing scientific reports on the issues concerned (substantial equivalence). • The same pattern has been shown in the Turtle-Dolphin Dispute, the new US regulation on shark fins and swordfish.

  18. THE HANDLING OF THE HACCP MEASURE • During 1999 and 2000, the tuna processing companies invested US$15 million in refurbishing, expansion and of course sanitary controls. • National legislation requiring the HACCP. • The HACCP team (INCOPESCA and ZED) • Boats: INCOPESCA and CANNEP are drafting a project to address this problem. They are identifying which ships are feeding processing plants that export to the EU.

  19. Strenghtening capacities: national level • Awareness raising • National and regional standard setting • Technology, innovation and enterprise development • Small and medium sized enterprises • Branding and umbrella certification • Institutional changes

  20. Actions at multilateral level • Transparent and participatory preparation of standards • Trade rules

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