Ladies and Gentlemen
I am very pleased to be here today to address the World Bank on the very important issue of the impact of EU SPS measures on developing countries.
A small but important clarification before I launch into the substance of my address. Please understand "SPS" as short-hand for legislation in the food and feed areas which impacts on public, animal and plant health.
I am encouraged that the World Bank is taking an increasing interest in the issue of SPS. At first glance, it might not fit well with the issues normally associated with the World Bank. But of course, it should! I am looking forward, therefore, to your forthcoming study on "the challenges and opportunities presented by SPS".
All of the citizens of the world, from the poorest to the richest, are dependent on food. All of us, without exception, must eat. But the importance to developing countries is even more pronounced.
Developing countries remain very heavily dependent on agriculture. Their peoples are much closer to the land and a high proportion of them earn their living from the land. The cost of food is also a much greater burden on their incomes.
A great many of developing countries continue to have problems in ensuring their own food security. And food and food products continue to be disproportionately important in their trade figures.
For all of these reasons, the World Bank must take SPS standards very seriously.
There is a huge challenge facing the developing countries, the least developed in particular, in raising the living standards of their peoples. A measure of their success, and of your role in assisting them, will be putting sufficient safe and nutritious food on the tables of their people.
So, where do I come into all this? As the European Commissioner for Health and Consumer Protection, my responsibility is to European consumers, in ensuring that their food is safe.
The answer lies in the title of my address: "the impact of EU SPS legislation on developing countries". Is this impact good, assisting their development? Or, is it bad, damaging their development possibilities?
The starting point is the objective of EU sanitary legislation. Put at its simplest, it is to ensure a high level of safety in relation to public, animal and plant health in the EU. The secondary purpose is to ensure that trade in animal and plant products can take place in safe conditions.
This needs to be underlined. SPS legislation is not an obstacle to trade. It is essential to trade! This explains the decision to create the SPS Agreement in the Uruguay Round Agreement. It reflected the reality that rules are necessary to facilitate trade in the area of food.
These two objectives, safe food and facilitating trade, are entirely complementary. Trade between the Member States of the EU in food products can only take place if there is full confidence that it is safe. It is the European Commission's job to help create the conditions leading to this confidence.
In our case, this requires a clear distinction between trade and food safety interests. The latter, food safety, cannot be manipulated to serve trade interests. This explains the clear segregation of responsibilities within the Commission.
The creation of my Directorate General, with specific responsibility for food safety, was designed to ensure that decisions would be taken with an eye to the consumer rather than trade interests.
By-and-large, we have been very successful in this respect. The EU is a single market for trade in food and food products. With some relatively minor exceptions, food is traded throughout the EU under the umbrella of a single body of uniformly implemented legislation.
This is a very significant achievement which should not be overlooked. The Member States of the EU had to be convinced to agree to this body of legislation. On sensitive issues of food safety, this was not an easy task.
A lot of suspicion had to be overcome and the confidence of Member States had to be won. The Commission is the key player in ensuring that the system works. We oversee the legislation, adapt and update it as necessary and ensure that it serves its primary purpose protecting public, animal and plant health.
This is a heavy responsibility. If we get it wrong, there are important consequences. The BSE crisis in particular taught us a lot of lessons. I was appointed to Office four and a half years ago with a clear mandate to implement the lessons learnt from the BSE experience. And I am satisfied that the reforms I have put in place over this period have fulfilled this mandate.
It is also important to keep in mind how vulnerable we remain to risks in relation to food safety and animal health. The outbreak of foot and mouth disease in 2001 is such an example. The recent worldwide outbreaks of avian flu are another.
The potential for avian flu to mutate into new and very dangerous strains of flu to which humans are very vulnerable is especially worrying.
These outbreaks serve to remind us of the need to avoid any complacency. Risks in the area of food safety, both old and new, continue to have the potential to cause major political and economic disruption.
The outbreak of SARS in China last year is a recent example of just how serious this disruption can be. It acted as an important brake on economic growth throughout China and the Asia region last year.
One can only imagine how much greater this damage might have been if the initial fears of the disease's infectivity had been realized.
However, without being complacent, I am convinced that we, the European Union, have made huge progress over the past several years in getting our food safety systems right.
We have increased the Treaty provisions in relation to food safety. This in turn has allowed us to put in place a new body of more powerful and up-to-date legislation. We have also created a European Food Safety Authority to provide independent scientific advice on risks associated with food.
In the process, the EU has increasingly acquired a single voice on food safety issues in the international arena. For example, the Commission represents the EU in the Sanitary and Phytosanitary Committee of the WTO. Similarly, we represent the EU in the CODEX Alimentarius which sets world standards in relation to food safety.
Where does this leave third countries and developing countries in particular? I am aware that there is an image that the EU, along with other developed countries, uses food safety standards for protectionist ends. It is a view which I suspect finds some sympathy in the corridors of the World Bank.
I could simply point to the import figures to refute this image. The EU is the single biggest food importer in the world. And we draw our imports from around the globe, from an incredibly diverse range of countries.
However, I am sure that you will require a more sophisticated answer than these figures if you are to be convinced that our standards do not serve protectionist ends.
We do not impose our standards on other systems of food production. These are issues for those countries to decide for themselves although I would argue that our systems, suitably tailored to local conditions, are good examples to follow.
However, we do insist that conditions relating to imports should be no more favourable, or less favourable, than apply to domestic producers. Frankly, I could not legitimately argue otherwise.
I fully accept that the EU sets very high food safety standards and that these are difficult to meet, in particular for developing countries. I make no apology for these high standards. Let me outline why they are necessary.
For the reasons outlined earlier, we have worked hard and invested hugely in putting in place safe food production systems. Food must conform to our very high safety standards, irrespective of its origins. I will not put these systems in jeopardy by taking unacceptable risks in relation to imports.
These risks are high. The animal disease situation in large parts of the world continues to be very worrying. Very dangerous diseases, such as foot and mouth disease, continue to be endemic. The EU has paid a huge price to eradicate these diseases and to maintain its disease free status. We will not put this success at risk by accepting imports, under unsafe conditions.
However, instead of being defensive, let me point to clear examples of how the EU facilitates imports from developing countries.
We implement the regionalization approach towards imports, a concept promoted in the SPS agreement in the WTO. In simple terms, we accept imports from regions of third countries where we are confident that this is not a risk to our public or animal health status.
This explains why we allow imports of fresh beef from countries like Brazil, Argentina and South Africa. We accept that there are regions in these countries where foot and mouth disease is either not present or is controlled through vaccination.
This contrasts with the approach not only of other developed countries but of developing countries. You will not be able to find an Argentinian beef steak here in Washington, for example, as the US has been much slower to embrace the policy of regionalization than the EU. This is true also of Japan.
Developing countries themselves are also slow to follow the concept. So the EU often faces unfair and discriminatory practices following an outbreak of a disease. Exports from the entire EU are often blocked even though only an individual Member State or region is affected.
Most of the world remains closed to our beef exports under the pretext of BSE, even though we have a comprehensive system of protective measures in place which ensure the safety of our beef.
Our measures are also soundly based on science, even when this works to our disadvantage. An example is BSE. In the absence of international classification of the risk status of individual countries, the Commission carried out its own scientific risk assessments of both Member States and third countries wishing to export to the EU.
These assessments led to the classification of the countries concerned. Many of our most important trading partners, like Brazil, Argentina, Australia and New Zealand are categorised in category I the "best" or safest category. We classed all the Member States of the EU in less favorable categories.
Our import requirements are tailored to these categories and thus these countries are subject to less rigorous requirements than Member States. Moreover, they use their favorable EU status to good advantage on other world commercial markets for beef and beef products.
Again, I challenge you to find similar examples of such treatment extended by other third countries.
We also try to be proportionate in our responses to food safety problems. An example is the recent outbreak of high pathogenic avian flu in Thailand. The Commission, in full conformity with the relevant international code of the OIE, imposed a ban on imports.
However, we excluded imports of certain cooked poultry meat products from this ban because we accept that cooking destroys the virus. This distinction allowed the EU market to remain open to 40% of Thai exports, the most high value added component of their trade.
The Thai authorities themselves officially acknowledged the proportionate response of the Commission. Our policies contrasted with virtually all other countries which imposed a total ban on all poultry products.
There are many other examples where we have found proportionate responses to problems with imports. While our primary responsibility is to ensure that food is safe, this can be reconciled with an approach which takes account of the special circumstances and difficulties faced by developing countries.
The EU is also open and transparent. It can quickly be established from our website which third countries are authorized to export to the EU and for which animal products. The import requirements are also publicly available.
Third countries can apply for authorization following a clearly defined path. If they can satisfy the Commission that they meet our requirements, we take the necessary decisions to signal their compliance with our food safety requirements.
This involves a visit by our inspectors to establish, on-the-ground, that these conditions are met. These reports, published on our website, provide clear and transparent information on the shortcomings and strengths of the sanitary conditions in the countries concerned.
Today, in Brussels, the Commission will submit a proposal to Member States to include both Romania and Zimbabwe in the list of third countries authorized to export fishery products to the EU under the most flexible conditions. This is an everyday example of how our system requirements can be met if the commitment exists.
We also insist that our conditions respect our international obligations. All proposed measures with a potential trade impact are notified to the WTO, to allow our trading partners to comment on their compatibility with the relevant international norms.
We take their comments seriously and if necessary amend the proposals in question or postpone their entry into force. Admittedly, comments are overwhelmingly from the developed countries. This is a point I will return to shortly.
We also participate fully in the key international standard setting bodies, like the CODEX, the OIE and the IPPC. I was especially encouraged that the European Community was accepted as a full Member of the CODEX in July last year.
Developing countries in particular supported our membership by an overwhelming majority in the formal, contested, vote on membership.
I take this as a signal that they see our membership as constructive in the development of international standards in the food area.
More generally, the EU and its Member States are the largest development donors in the world both in absolute and relative terms. We are committed to the achievement of a fairer, more equitable and more prosperous world.
In the area of food safety, my Commission colleagues are financing significant horizontal projects in the area of fisheries, pesticides and animal health targeted at the African, Caribbean and Pacific countries in particular.
These are in addition to the multitude of SPS related projects being funded under our aid programmes for individual countries.
We are the first port of call for any developing country looking for assistance to upgrade its SPS systems.
We are assisting these countries to better develop their food safety systems, primarily to improve their own food security but also in the hope that they will in time develop the capacity to export their food products to the EU.
While I believe that the protectionist image of the EU in relation to food safety is untrue, I do accept that more should be done to assist developing countries meet our standards.
Last week, the European Parliament voted its approval of a major new regulation on food and feed controls. This regulation will enter into force on 1 January 2006 and will radically alter the current control systems designed to ensure that food is safe.
It will also have major implications for developing countries. With a view to assisting them to meet the challenge of the new regulation, it includes a number of important provisions including training and "twinning" projects where Member State experts work closely with a designated developing country.
There is also provision for allowing for differential treatment of developing countries to reflect the composition of their exports to the EU. For example, if their exports are of a particular commodity or product, their control measures could be tailored accordingly.
Moreover, to ensure that there are no surprises, my development colleagues have commissioned a major study on the potential impact of the regulation. This study will be available by the end of this year, allowing a further year for the Commission services and their developing country counterparts to adapt to the new regulation.
I hope that this brief outline will help convince you that the image of protectionist EU SPS standards is far from being true.
I would now like to turn to the role of the World Bank in relation to food safety. I remarked earlier that food safety is not a concept normally associated in people's minds with this institution. I genuinely hope this will change.
Leaving aside the EU's trade policy in agriculture, safe food must be a priority for developing countries. Their consumers deserve safe food. It is essential both in the interests of food security and public health. They cannot afford the high costs of unsafe food. The World Bank must recognize this in its own policies.
It would be a mistake to focus only on safe food in the context of strengthening the export capacity of developing countries. That must come second to the primary objective of strengthening their protective systems for their own consumers. I would hope that trade would follow rather than lead this process.
We must all keep in mind the dangerous dilemma of food shortages in certain developing countries co-existing with exports of high value- added luxury foods to Western consumers. This might be comprehensible from a trade perspective, but is hard to explain to civil society.
Nonetheless, the reality is that it will often be hard, in the short term at least, to move to a food safety system which meets the developed world requirements. China, in its efforts to meet concerns regarding its exports to the EU has adopted a specific "export oriented scheme" geared specifically to the export sector.
I would suggest therefore that capacity building efforts should focus on the domestic sector.
This is not to argue that the World Bank should ignore the international arena in relation to food safety. There is room for improvement in this area also and we all have a role to play.
There is a valid expectation that the Doha Development Round will lead to further trade liberalization, including in agriculture. Franz Fischler recently spoke to you on the reform of the Common Agriculture Policy and I hope that you appreciate fully the scale of the changes currently underway.
These changes are under-estimated by our trading partners. The EU has not received the recognition it deserves for its efforts to make its agriculture production systems more compatible with its international trading obligations.
However, the focus should not only be on tariffs and quotas in the Doha negotiations. Unless there is a serious effort to also strengthen the capacity of developing countries to meet the food safety standards of the developed world, the opportunities presented by trade liberalization in the food area may prove illusionary.
I am speaking in particular of the least developed countries. They already enjoy virtual free access to EU markets but the results have been disappointing. Their more developed partners, like Brazil and Thailand, on the other hand are already well equipped to meet these standards.
A number of initiatives come to mind. The capacity of the developing countries to participate in the WTO/SPS must be strengthened. This is recognized by the WTO itself. I believe that they deserve our support in making more active participation a reality rather than an aspiration.
This in turn calls for full support for the "Standards and Trade Development Facility" established under the auspices of the WTO and bringing together key partner organizations like the FAO, OIE, WHO and the World Bank.
I acknowledge that the World Bank has provided the seed capital to launch this initiative. Its objective in helping developing countries participate more fully in setting and making use of international SPS standards is laudable. A working group meeting took place in Washington last week and I hope that its results will be shared with the Commission.
The developing countries are currently under-represented in the key standard setting bodies, such as the OIE, the CODEX and the IPPC. It is not only a question of physical presence but of participation. There should be a greater focus on regional groupings. The EU already effectively organizes itself on this basis. Other regions could follow our example, either on a formal or informal basis.
There also needs to be greater coordination between the developed countries on food safety issues. A major focus of my visit to Washington is to encourage better cooperation between the EU and the US.
We both have highly efficient and very safe systems of food production. Yet, we find ourselves all too often on different sides of the table when it comes to applying food safety standards.
This has important implications for the developing world who risk being caught in the cross-fire between the world's two largest trading blocs. If we could work together better, I am convinced it would serve also the interests of our less developed trading partners.
Ladies and gentlemen, I have taken up a lot of your time. I now look forward to your comments of how you view the role of SPS standards, especially in the EU, in relation to the developing world.
In due course I also look forward to the study of the World Bank on SPS measures. I hope that it will look constructively and imaginatively at the issues involved and strengthen our understanding of the role of these standards in international trade.
Thank you for your attention.