Non-tarriff barriers to food trade an obstacle to the lasting prosperity of the APEC region

Issued by the APEC Business Advisory Council (ABAC)

Lima, 17 November 2016 – A thicket of costly red tape, opaque administrative processes and arbitrary food-trade rules pose a risk to the lasting food security of the three billion people in the APEC region, a new study commissioned by the APEC Business Advisory Council suggests.

ABAC commissioned the report, entitled ‘Non-Tariff Barriers in Agriculture and Food Trade in APEC: Business Perspectives on Impacts and Solutions’, from the University of Southern California’s Marshall School of Business.  It draws on interviews with over four hundred business people, experts and officials from around the region.

“Food insecurity exacerbates the misery of stagnating global economic growth,” said Juan Raffo, ABAC Chair for 2016.  “Food security is a fundamental building block of lasting and inclusive prosperity for our region.”

“Food trade is a critical part of the food security equation.  It helps to match up supplies of safe, nutritious and affordable food with demand from around the region.  But this study shows that NTBs and other forms of protectionism mean that food trade is more difficult and expensive than it should be,” Mr Raffo added.

The study found that non-tariff measures, including NTBs, are increasing in prominence and complexity.   NTBs include opaque rules, arbitrary standards that are not based in science, and Customs and other import procedures that are slow, costly and excessive.  The research showed that these barriers can raise food prices, undermine food quality, impact on food availability and impose extra burdens on small businesses.Over half the businesses interviewed considered that the trading environment for food and agriculture products remains highly restrictive.

“Business is reporting that these NTBs can undermine the whole food supply chain. Exporting and importing food becomes expensive and complex – uncertainty and time delays can cripple small business in particular.   That works against lasting food security,” said Mr Raffo.

The report stressed the need for a concerted and sustained effort across many fronts to address NTBs.  “This study suggests that what’s needed is greater transparency, clearer timeframes and better processes for food trade before, at and behind borders.  Measures should be designed to avoid impeding trade.  Greater harmonization or mutual recognition of standards for labelling and food safety would help.  Digital channels hold a lot of promise, too,” Mr Raffo added.

“APEC economies have a big task ahead of them in addressing these NTBs,” commented Mr Raffo.  “But the business community is committed to helping deliver lasting food security in partnership with governments, for the benefit of all,” he concluded.

A copy of the USC Marshall School report can be found at https://www2.abaconline.org/content/download/22613384