1. Disciplining the use of food safety measures: The impacts of the WTO SPS agreement on developing countries Michael Friis Jensen Researcher, Globalisation & Governance, DIIS Standards and Trade: Impacts of food safety, quality and ‘sustainability’ standards on developing countries. A ‘Trade Mondays’ seminar funded by the Danish Institute for International Studies (DIIS) and the Governance, Economic Policy & Public Administration Research Network (GEPPA), Copenhagen, June 7, 2004

2. The problem How to distinguish between protection and protectionism? In theory: The SPS agreement defines legimate measures (e.g. based on science and non-discriminatory) and bans illegimate ones In practice: It is a question about balancing free trade concerns with food safety concerns

3. Functioning of the SPS Agreement

4. Instruments in the SPS Agreement Harmonisation Dispute settlement mechanism SPS Committee Transparency provisions Special concerns: Technical assistance to and special and differential treatment of developing countries

5. Central problems in the agreement Harmonisation: What are developing countries interests? Has the encourgement to harmonisation been misunderstood as an obligation? Non-discrimination: What is ”discrimination or a disguised restriction on international trade” (Art. 5.6)? Lack of definition! Risk assessment (in cases where no international standards exist): Little if any capacity in most developing countries

6. Effects of the SPS Agreement

7. Capacity to resolve disputes involving developing countries Formal (DSB): –18 formal complaints, one from a developing country –No African of LDC have made a formal complaint –Developing countries have been successful in challenging developed countries under other agreements Informal (SPS Committee): –183 specific trade concerns raised during 1995-2003 –40% of issues raised are about developing countries’ market access –Issues mainly raised by a handful of countries primarily developing country members of the Cairns Group

8. New issue in international trade liberalisation Costs include: –costs of setting up public infrastructure (notification and inquiry points, foreign representations in WTO and standards organisations) –reform of SPS legislation and standard setting procedures where international standards exist where international standards do not exist Implementation costs

9. SPS agreement a useful and welcome tool for a number of middle income countries, but: –SPS agreement addresses parts of the problems of food safety measures acting as trade barriers –SPS agreement targets the problem that developed countries face but has difficulties of embracing developing country problems –The article on harmonisation (Art. 3) has had a profound impact on the thinking about how to reform developing countries food safety regulations. This may have resulted in sub-optimal policies –SPS agreement unlikely to deliver increased market access to most developing countries but may result in substantial implementation costs –Developed countries face the challenge of assisting developing countries to secure benefits from the SPS agreement Conclusion: Overall the SPS agreement is a significant improvement upon the pre- WTO situation, but there is still ample room for improvement and some countries might end up as net loosers Qualification: There is still much uncertainty of (a) how food safety measures impact on trade; and (b) how the various disciplines laid out in the SPS agreement impacts on trading opportuninies Conclusions