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Impact of Food Safety Standards on Processed Food Exports from Developing Countries

  • Jongwanich, Juthathip

    (Asian Development Bank)

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    This paper examines the impact of food safety standards on processed food exports in developing countries. An intercountry cross-sectional econometric analysis of processed food exports in developing countries was undertaken. The Sanitary and Phytosanitary Standard (SPS) is incorporated into the model to capture the impact of food safety standards. The empirical model shows that food safety standards imposed by developed countries tend to have a negative implication for processed food exports from developing countries. Since SPS is less transparent than tariffs or quotas, practically, there is ample room for developed countries to tweak the standards to be stronger than necessary to achieve optimal levels of social protection, and to twist the related testing and certification procedures to make their own competing products competitive with imports. However, because of the potential benefits that could emerge from imposing food safety standards such as a reduction of transaction costs and trade friction, developing countries should view SPS not just as a trade barrier but an opportunity to upgrade quality standard and market sophistication. Multilateral efforts are needed to mobilize additional financial and technical assistance to help redress constraints in developing countries in meeting the required food safety standards imposed by developed countries.

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    Paper provided by Asian Development Bank in its series ADB Economics Working Paper Series with number 154.

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    Length: 29 pages
    Date of creation: Apr 2009
    Date of revision:
    Handle: RePEc:ris:adbewp:0154
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    1. Prema-chandra Athukorala & Sisira Jayasuriya, 2003. "Food Safety Issues, Trade and WTO Rules: A Developing Country Perspective," Departmental Working Papers 2003-13, The Australian National University, Arndt-Corden Department of Economics.
    2. Regmi, Anita & Gehlhar, Mark J. & Wainio, John & Vollrath, Thomas L. & Johnston, Paul V. & Kathuria, Nitin, 2005. "Market Access For High-Value Foods," Agricultural Economics Reports 33999, United States Department of Agriculture, Economic Research Service.
    3. Prema-Chandra Athukorala & Kunal Sen, 1996. "Processed Food Exports from Developing Countries: Patterns and Determinants," Trade and Development 96/14, Australian National University, Department of Economics.
    4. Otsuki, Tsunehiro & Wilson, John S. & Sewadeh, Mirvat, 2001. "A race to the top? A case study of food safety standards and African exports," Policy Research Working Paper Series 2563, The World Bank.
    5. Eduardo Borensztein & Jose De Gregorio & Jong-Wha Lee, 1995. "How Does Foreign Direct Investment Affect Economic Growth?," NBER Working Papers 5057, National Bureau of Economic Research, Inc.
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