Global Trade and Food Safety: Winners and Losers in a Fragmented System

Abstract

Abstract: Food safety and the trade-off between precaution and increased agricultural exports is at the forefront of policy debate. Discussions of food safety standards and their relation to trade have been prominent in many of the position papers developed in advance of the World Trade Organization (WTO) Ministerial in Doha set for November 2001, for example. How food safety is addressed within the trading systems is of significant importance to developing countries which continue to rely on agricultural exports. This includes some of the least developed exporters of cereals, fruits, an nuts in Africa, Asia, and Western Hemisphere. Moreover, in a fragmented system of conflicting national standards – and lack of agreement on globally accepted regulation of food safety attributes-- export prospects for the least developed countries can be severely limited. This study examines the impact of adopting international food safety standards and harmonization of standards on global food trade patterns. The paper estimates the effect of aflatoxin standards in 15 importing (4 developing) countries on exports from 31 (21 developing) countries. Aflatoxin is a natural substance which can contaminate certain grains and nuts when storage and dryin