Regulatory standards have taken increasing importance in the regulation of agricultural exchanges in recent years. These standards tend to significantly reduce exports from the least developed countries and small and medium -sized businesses. Their effects on trade and well-being, however, do not necessarily go in the same direction, making their analysis more complex than that of traditional trade barriers.
The reduction of pricing barriers to exchanges allowed by the various cycles of multilateral negotiations carried out under the aegis of the World Trade Organization (Omc) On the one hand, and the growing demand for healthy products, respectful of the environment and social rights expressed by consumers on the other hand, have led to the multiplication of regulatory standards in recent years. Among the various sectors of activity, agriculture is the most concerned. Standards are particularly present and often a source of friction between countries. By way of illustration, the number of commercial disputes relating to the value of exports is the highest (Onectad2005).
Standards are often useful for correcting market failures but can also be used for protectionist purposes, a use regularly denounced by developing countries (Beghin, 2008). Also, assessing their effects on trade and well-being is often difficult. A better understanding of these effects, both theoretically and empirically, is one of the challenges of international economics research for the years to come.
International agreements
Internationally, public standards are governed by two agreements ofOmc : agreements SPS (Agreement on health and phytosanitary measures) and OTC (Agreement on technical obstacles to trade). Entered into force in 1995, the agreement SPS Allows countries to adopt measures to guarantee the safety of food products, animal health and plant preservation. These measures must be scientifically founded. A transitional period of two years is granted to developing countries (five years for the least advanced countries) before the complete implementation of the agreement. Integral part of the agreement establishing theOmcthe agreement OTC covers, for its part, technical regulations, standards and tests of testing and certification not included in the agreement SPS. Unlike the agreement SPSscientific elements are only one of the components to be taken into account when assessing the risks prior to the adoption of measures.
Public standards should not create unnecessary obstacles to exchanges, nor be a source of arbitrary discrimination. To do this, countries are encouraged to resume, when they exist, international standards (those, for example, established by the Codex Alimentarius commission). The agreement OTC also encourages countries to recognize as equivalent technical regulations and procedures for assessing the compliance of other member countries of theOmceven if these regulations and procedures differ from their ; said regulations and procedures must nevertheless adequately meet the objectives of their own legislation. Finally, each country must publish the measures in force on its territory and an information point must be established in order to inform the partner countries.
The two agreements contain provisions concerning technical assistance and special and differentiated treatment which can be granted to certain countries, in particular to developing countries. Despite these provisions, it often remains difficult for exporters of these countries to meet the requirements laid down by importing countries.
The question of private standards
The last decade is characterized by the rapid development of private standards. Three major reasons explain this evolution: 1) globalization which connects different production systems depending on countries and companies ; 2) The slowness of the public regulation process and 3) the growing concern of consumers for health security, the environment and social rights. Consequently, private standards constitute, for companies, a relatively effective means of coordinating disparate production systems and protecting yourself from commercial and/or reputational risks. These standards are often perceived as:
– essential to trade, making their implementation compulsory ;
– more controlling exchanges than public standards ;
– more restrictive than public standards.
However, studies on this theme suggest a more complex reality (Henson and Humphrey, 2008). The border between public standards and private standards is, in particular, very tenuous. Voluntary private standards can, for example, be taken up in public legislation and therefore become compulsory.
Private standards they are agreements SPS And OTC ? Although largely debated within theOmcthis question is, to date, not decided and no jurisprudence exists in this area. This aspect could become particularly significant in the event of appeal filed with theOmc By a country against another member about the standards adopted by companies located on its territory. Also, this expansion of private standards and this permeability between public and private regulations constitute a challenge for theOmc For the years to come.
The commercial effects of public standards
These effects are ambiguous: in the event of incomplete information, standards can promote exchanges by reporting to consumers healthy and environmentally friendly products and social rights. On the other hand, the impact on trade is negative if the regulations generate a sharp increase in production costs, in fact excluding a number of market producers.
The multiplication of standards worldwide can also reduce trade if producers, in order to limit their costs, decide to provide only the markets where the standards in force are the least demanding (Korinek et al.2008). The harmonization of regulations on an international basis can make it possible to overcome this problem. However, this harmonization leads to product standardization (fewer varieties available on the market) and can restrict exchanges.
Most existing studies offer an assessment ex-post commercial effects of regulations. These effects are generally established via the estimation of a severity equation. Some work has also been interested in the consequences of standards on business export decisions. Conversely, certain research has set out to appreciate ex-ante The effects to be expected from setting up standards, via simulations. In addition to these quantitative analyzes, several studies offer a more qualitative analysis of standards, based on the examination of surveys collected from companies.
The results obtained vary from one study to another. The best established fact is that exports from developing countries, and among them the least advanced countries, are significantly negatively affected by standards (Disder et al.2008). Likewise, several studies show the existence of a size effect: small and medium -sized enterprises are the most affected (Wilson and Otsuki, 2004). Regarding the harmonization and/or mutual recognition procedures between countries, different analyzes suggest that they have a positive effect on trade flows. Furthermore, the use of international standards preferably to national measures would less reduce exchanges (or even in some cases would promote them). However, some studies contradict these results.
Effects on trade and potentially different well-being
These analyzes of the commercial effects of the standards, whether they are carried out ex-ante Or ex-posthowever, do not allow an evaluation of the impact on each category of economic agents concerned (producers, consumers, governments, etc.). In a recent article (Disdier and Marette, 2009), we propose to link the evaluation of the effect of standards on trade and well-being. The effect on exchanges, estimated from a severity equation, is used during the analysis of the impact of the regulations on the well-being of the various economic agents. Empirical analysis relates to the standards adopted by several developed countries on chloramphenicol, antibiotic widely used in crustaceans farms from developing and toxic countries for human health. The results show that commercial and well-being effects do not necessarily vary in the same direction. Standards reduce exchanges but allow, in most cases, an increase in international well-being. The loss of profits suffered by producers of exporting countries is, in general, more than compensated by the gain of well-being observed for consumers of importing countries following the reduction of the damage caused to human health. An increase in profits from localized producers in importing countries is also noted. This increase results from the increase in prices of crustaceans induced by the drop in imports.
The protectionist nature of poorly evaluated standards
As mentioned in the introduction, countries can adopt standards for protectionist purposes and pressure groups can influence their definitions. However, these elements remain little taken into account in studies measuring the effects of standards (Korinek et al.2008). In addition, the theoretical and empirical framework available to economists to deal with these aspects must be revisited. Indeed, if the political economy of protectionism provides interesting explanations, it tends to be based on relatively simple definitions of protection. However, the forms taken by the standards are often complex and their adoption, if it allows to correct a market failure, can result in a gain of well-being.
In recent years have been marked by an increasing influence of public and private regulations on international trade. These standards often take complex forms and their costs in terms of well-being are less obvious than those generated by pricing and quantitative barriers. However, these standards often have negative trade effects, especially in North-South exchanges. They tend to marginalize the international market
developing countries, and more particularly the least
advances. They thus annihilate commercial preferences (prices
reduced or even zero customs officers) granted as the policy of
development.
Different assistance programs have been implemented to counter these negative effects. However, assistance remains fragmented, insufficient and poorly integrated into national activities. In a common project carried out in the mid -2000s, the Center for International Commerce and the Commonwealth Secretariat suggested five ways of improvement, namely: 1) an increase in aid ; 2) Better coordination ; 3) Better framing ; 4) A consideration of the specificities of developing countries and the least advanced countries, and finally 5) taking into account the particular needs of each recipient country. In this period of global economic crisis, these objectives remain more relevant than ever.