The Economics of Biotechnology (Gmos) and the Need for A Regional Policy: The Case for COMESA Countries

Many countries in the world have adopted genetically modified organisms as products that can have great beneficial impact on agriculture, industry and trade. However, to date for the whole of Africa, only South Africa has commercialized genetically modified organisms (GMOs). Realizing the high transactions costs—particularly in trade that may underlie different countries having varying policy stances on biotechnology, COMESA (COMESA—Common Market for Eastern and Southern Africa, is a regional grouping of 20 countries. In the context of this study, Tanzania is also included although it is not a COMESA member. This is because it belongs to the Association for Strengthening Agricultural Research in Eastern and Central Africa (ASARECA) of which nine countries are in COMESA. ASARECA was an active partner in this process together with ACTS—African Centre for Technology Studies and PBS—Program on Biosafety) in collaboration with a number of partners embarked on a process of shaping a regional consensus on biotechnology policy for their 20 countries between 2004 and 2006 and adopted it in principle by the end of May 2006. Based on case studies of six countries—Egypt, Kenya, Ethiopia, Tanzania, Uganda and Zambia, this paper, summarizes the analysis of projected farm income gains in the region from commercialization of Bt maize and Bt cotton; provides an analysis of commercial export risks from approval of GMOs and states the position of COMESA countries on GMOs to date. Using quite conservative methods, projected net income gains from GMOs remain significant with over US $ 25 net benefit per hectare. As regards commercial export risks to Europe from GMOs, the analysis suggests that except for Egypt, countries need not fear significant export losses if they make a decision to plant any of the GM commodities currently on the market.