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Food Safety and Agricultural Health Management in CIS Countries: Completing the Transition

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Food Safety and Agricultural Health Management in CIS Countries: Completing the Transition THE WORLD BANK Food Safety and Agricultural Health Management in CIS Countries: Completing the Transition Agriculture & Rural Development Department World Bank 1818 H Street, N.W. Washington, D.C. 20433 http://www.worldbank.org/rural REPORT NO. 40069-RU Food Safety and Agricultural Health Management in CIS Countries: Completing the Transition THE WORLD BANK AGRICULTURE AND RURAL DEVELOPMENT DEPARTMENT © 2007 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/rural E-mail [email protected] All rights reserved. This volume is a product of the staff of the International Bank for Reconstruction and Development/The World Bank. The findings, interpretations, and conclusions expressed in this paper do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accu- racy of the data included in this work. The boundaries, colors, denominations, and other information shown on any map in this work do not imply any judgment on the part of The World Bank concerning the legal status of any territory or the endorsement or accept- ance of such boundaries. The material in this publication is copyrighted. Copying and/or transmitting portions or all of this work without permission may be a violation of applicable law. The International Bank for Reconstruction and Development/ The World Bank encourages dissemination of its work and will normally grant permission to reproduce portions of the work 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, http://www.copyright.com/. All other queries on rights and licenses, including subsidiary rights, should be addressed to the Office of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA, fax 202-522-2422, e-mail [email protected]. Contents ACRONYMS AND ABBREVIATIONS vii FOREWORD ix ACKNOWLEDGMENTS xi EXECUTIVE SUMMARY xiii 1 Introduction 1 International Trading System 1 SPS Management 2 Transition Economies and the GOST Standards System 4 Objective of the Study 5 Method 5 2 Agriculture and Markets in CIS Countries 7 Differences among CIS Countries 7 Agricultural Production Since Transition 8 Consumption and Markets 9 International Trade in Agro-Food 11 Summary: Country Group Characteristics 18 3 GOST System and Its Implications for Health and Competitiveness 21 GOST-Based Standards 21 GOST-Based Systems and Systems Based on WTO Principles 22 Food Safety and Agricultural Health 23 Standards and Other Constraints to Market Access in the OECD 27 Governance Issues 30 Summary: SPS Issues and Country Groups 32 iii iv Contents 4 Replacing GOST-Based Systems by Systems Based on WTO Principles 33 Choices to Be Made 33 Evolving Principles for SPS Management in Market Economies 34 Adjusting the Institutional Architecture 36 Experiences of Reform 39 Legal and Regulatory Reform in CIS Countries 42 Diagnostic Capacity 44 The Private Sector 45 Regional Cooperation 49 Costs and Benefits 51 International Assistance for Food Safety and Agricultural Health 55 5 Conclusions and Recommendations 61 Conclusions 61 Principles and Considerations for SPS Management Reform 63 Recommendations for Reform Implementation 66 International Support for SPS Reform in CIS 68 APPENDIXES Appendix 1. Russian Bans on Agro-Food Imports 71 Appendix 2. New Agricultural Health Challenge in Plant Health 73 Appendix 3. Zoonotic Disease and Socioeconomic Impacts: Integrating Human and Animal Health Measures 77 Appendix 4. Identified Risks from CIS Food and Feed Exports to the EU Market 81 Appendix 5. World Bank Activities in CIS 85 Appendix 6. Estimating Costs and Benefits of SPS Management 89 Appendix 7. Cost Estimates for Animal Identification and Registration 99 Appendix 8. Spending on SPS under EU Accession Programs 101 Appendix 9. Armenia’s Live Crayfish Exports to the EU 103 GLOSSARY 105 NOTES 109 REFERENCES 111 Boxes 1 WTO Principles on the Use of SPS Measures 2 2 Some Terms Explained 3 3 Elements of an SPS and Agricultural Health Management System 3 Contents v 4 Market Segments 12 5 Features of Modern Retailing and Implications for Producers and Processors in CIS 14 6 Sanitary Compliance by Smallholder Livestock Farmers 26 7 Ukraine’s Kefir and Sour Cream Standard as Compared to Codex and EU Standards 28 8 EU GSP for Moldova and Ukraine 29 9 Requirements for Third Countries Exporting Animal Products to the EU 29 10 Issues on Governance 31 11 Integrated Agricultural Health Safeguarding System 35 12 Canada’s Creation of a Single Food Inspection Agency: CFIA 38 13 Ukraine’s Legislative Efforts 43 14 Streamlining Kazakhstan’s Veterinary Laboratories 45 15 Small Farms, Food Safety, Agricultural Health, and Competitiveness 47 16 The Private Sector in Armenia 48 17 Milk Quality and Safety Improvement in a Dairy Supply Chain in Poland 49 18 Regional Cooperation in Southeast Asia 50 19 Cost of Capacity Building for SPS Management 52 20 Economics of Animal Identification and Registration, Including Tracing Animals 55 21 The European Union and the CIS Countries 58 22 Developing Food Safety and Agricultural Health Action Plans for Lao PDR and Vietnam 60 Figures 1 Role of Agriculture in CIS Economies, 2003 8 2 CIS Production of Major Crops, 1992–2005 10 3 CIS Production of Major Animal Products, 1992–2005 10 4 Share (percentage) of Agro-Food Trade in Total Trade, Selected CIS Countries, 2004 15 5 DALYs Lost to Diarrheal Diseases, 2002 25 A2-1 Distribution of WCR in Europe after Introduction in 1991 73 A3-1 The Global Extent of Echinoccocus 78 A9-1 Live Crayfish Exports from Armenia 103 Tables 1 CIS Membership in WTO and SPS Bodies 4 2 Agricultural Value Added, Constant 2000 9 3 Change in Per Capita Food Supply in CIS 11 4 Agro-Food Export and Import of CIS Countries, 2004 15 5 Agricultural Exports Relative to Agricultural GDP, Average 16 6 Agro-Food Export Markets: CIS vs. CEE10 16 7 Origins of Agro-Food Imports: CIS vs. CEE10 16 8 Agro-Food Export, 1997 and 2004, Selected CIS and CEE Countries 17 9 Food Export Destinations for Selected CIS Countries, 2004 17 10 Export of SPS-Sensitive Products by Exporting Country, 2005 18 11 Characteristics of Three Groups of CIS Countries 19 12 Estimated Wage Loss Due to Food- and Water-Borne Diseases 25 vi Contents 13 SPS Issues for Country Groups 32 14 Country Group Capacities and Options 68 A1-1 The Russian Federation’s Import Bans on Agricultural and Food Products 71 A2-1 Estimated Average Annual Losses to the Maize-Growing Industry from WCR 74 A3-1 Echinococcosis Disease Burden 79 A4-1 Notifications Involving CIS Consignments 81 A4-2 Hazards Identified from CIS Consignments 82 A5-1 World Bank SPS-Related Studies, 1996 to the Present 85 A5-2 World Bank SPS-Related Lending, 1996 to the present 86 A5-3 World Bank SPS-Related Lending, in Preparation 87 A6-1 Moldova Agro-food Exports 89 A6-2 Estimation of Costs with Various Standards Regimes for Moldova 90 A6-3 Estimated Costs for the Public Sector 91 A6-4 Proposed Budget for Vietnam Action Plan 92 A6-5 Results of Cost-Benefit Exercises 93 A6-6 Cost-Benefit Assessment for Lao PDR 95 A6-7 Cost-Benefit Assessment for Armenia 96 A6-8 Cost-Benefit Assessment for Moldova 97 A7-1 Derivation of Cost Estimates 99 Acronyms and Abbreviations ARD Agriculture and Rural Development Department ASEAN Association of Southeast Asian Nations BEEPS Business Environment and Enterprise Performance Survey BNPP Bank Netherlands Partnership Program BRC British Retail Consortium BSE Bovine spongiform encephalopathy CAC Codex Alimentarius Commission CARDS Community Assistance for Reconstruction, Development, and Stabilization CEE Central and Eastern Europe CFIA Canadian Food Inspection Agency CIS Commonwealth of Independent States CMEA Council for Mutual Economic Assistance Codex Codex Alimentarius CSF Classical swine fever DALY Disability-adjusted life year DDP Development data platform EASC Euro-Asian Council for Standardization, Metrology, and Certification EBRD European Bank for Reconstruction and Development EC European Commission ECA Europe and Central Asia EFSA European Food Safety Authority ELISA Enzyme-linked immunosorbent assay ENP European Neighbourhood Policy EPPO European and Mediterranean Plant Protection Organization EU European Union EUREPGAP European Retailers Produce Working Group good agricultural practices FAO Food and Agriculture Organization FAOSTAT FAO Statistical Database FMD Foot and mouth disease FSU Former Soviet Union FVO Food and Veterinary Office (European Commission) vii viii Acronyms and Abbreviations GAO Government Accountability Office (United States) GAP Good agricultural practice GDP Gross domestic product GLP Good laboratory practice GMP Good manufacturing practice GOST Gosudarstvennyy standart, or state standard GOST-R Standards of the Russian Federation GPAI Global Program for Avian Influenza GSP Generalized system of preferences HACCP Hazard analysis and critical control points I&R Identification and registration IPPC International Plant Protection Convention ISO International Organization for Standardization ISPA Instrument for Structural Policies for Pre-Accession MARD Ministry of Agriculture and Rural Development (Vietnam) MFN Most favored nation MRL Maximum residue level OECD Organisation for Economic Co-operation and
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