SG Scribbling Vol 1, Sabari Ganesh [bookstand for reading .txt] 📗

in trade among nations.

This practice is effectively adopted by both the developed and the developing countries, to their advantage. No wonder, cases relating to SPS and resulting trade restrictions are piling in the Dispute Settlement Board (DSB) of the World Trade Organization. (WTO) The ongoing events call for an urgent need, to harmonize the SPS measures uniformly for all the member nations, which could hope to prevent the misuse of a very essential quality standard.

            The International Maritime Organisation (IMO) has taken a multitude of initiatives that pertain to ship safety and prevention of marine pollution, by streamlining the management of ballast water in the cargo ships. The ballast water exchange standard and ballast water performance standard focus on a formal procedure that is uniform and conforming to the IMO.

The ballast water exchange standard focus on transfer of ballast water on a volumetric basis among ships than letting out in the open sea to minimize bioinvasion. The severity of its protection is in the fact that such a transfer should be done at around 200 nautical miles from the nearest coast and 200 meters below the sea water. The ballast water performance standard focuses on the presence of viable organisms in the discharge. The stipulation is less than 10 organisms per cubic meter. Also, such a discharge in the open sea would be permitted only in select areas around the port.

As regards India, we are yet to have a structured and detailed database that provides concise information on our aquatic wealth. There also has not been adequate research done in this area or papers published on the impact of the invasive species in India. Scientific information has always been the primary requisite to fight and prevent any damage that arises out of invasion of alien species. India lacks terribly on this front.

Apart from information, India also falls behind in the technological necessity to conform to the standards laid down by the IMO, with regards to Ballast water management. The cost factor is a prime bottleneck and the ability of the technology to prove its performance within the cost parameters is also crucial for its commercial viability. Some of the present trends witnessed in ballast water management are –

Ultraviolet and ultrasound techniques that aim at inactivating the invasive species. Ozone pumping that aim at disinfecting the invasive species, but ozone is corrosive. De-oxygenation of the ballast water. The engine heat is used to sterilize the ballast water; but inconsistent and expensive. Chemical and biocide treatment of the ballast water.

The world nations have adopted only a reactive approach to the issue of bioinvasion till date. Even the discussions pertaining to bioinvasion surfaced only in times of a marked distress call. The research measures undertaken to identify, analyse and undertake preventive and curative steps to bioinvasion has been grossly inadequate. This gains importance in the light of the fact that preventing or eradicating bioinvasion at its infancy is logically appreciative in terms of tangible results and minimizing costs.

            Prevention is found to be better than curbing and cure; and hence is gaining momentum in the international forum of trade talks, propelled by the member countries gaining more scientific and reliable information from various parts of the world on the devastative effects of bioinvasion, due to sheer carelessness and lack of focus in logistics pertaining to international trade among nations.

Sanitary & Phytosanitary Measures as Barriers to International Trade

Sanitary & Phytosanitary Measures as Barriers to International Trade
© Sabari Ganesh; “All Rights Reserved” 
authorsabariganesh@gmail.com
https://sabariganesh23.sarahah.com

 

Introduction:

            The World Trade Organisation (WTO) was established on January 1, 1995 with the sole prime objective of promoting free and fair trade among nations of the world. The direct impact of a free trade is the blurring and unification of markets, for any given product or service. The whole world becoming the market for a product manufactured by a company, and the natural tendency of people – consumers preferring quality products at competitive price has eventually made survival of the fittest the rule of the game.

            The companies started focusing on their core competency and thereby became the market leaders across the world for their produce. This resulted in the domestic companies losing their markets to the global players. The prime reason is the domestic players lacking the requisite professionalism and resources needed to compete on an even ground at par with their global counterparts. The political and business economics arising thereof resulted in protectionist measures in the form of tariffs to save the infant industries and domestic ventures of the land. However, WTO with a strong focus of promoting free trade among nations was successful in eliminating direct barriers to trade – Tariffs; and non-tariff barriers like Quantitative Restrictions, Quotas, Subsidies, and Voluntary Export Restraints.

            However, the push and pull factors of nations to protect their domestic industries has forced them to discover new arena that could be tweaked to become a barrier to free trade thereby protecting their domestic industry. The Sanitary and Phyto-Sanitary (SPS) measures is one such glitch in the hands of nations.

SPS Measures – Foundation:

            It is well justified that any consumer, when out for a purchase of a product would try to be sure that the product being purchased is of the requisite quality. This justification is the foundation of enacting the SPS measures under the WTO trade rules. In a trade between companies of different nations, the consumer gets to see the actual product only after import; and when it reaches the destination port. In the event of the quality of the product found to be unsatisfactory and dangerously contaminated, would naturally lead to intense disputes among companies and nations. Also, the product of a bad quality, with contaminants might cause potential threat to the plant, animal and human health of the importing country. To prevent this WTO has set up certain basic laws that intend to protect the plant, animal and human life and health, of the importing country.

SPS Measures – Definition & Issue:

            SPS measures are a set of regulations that aim to protect the plant, animal and human health of the importing country. The Sanitary measures focus on protecting human and animal health while the Phyto-Sanitary measures focus on protecting plant health. These measures on the face of it are very genuine necessity for any nation in its endeavour to protect its plant, animal and human resources from the entry of pests, contaminants and diseases arising out of trade among nations.

The implementation of SPS measures and the level of protection required by the member countries on their imports are based on scientific evidence. WTO has granted its member countries freedom to determine at their individual discretion the level of quality of the product that is imported by their country. The result is a vast variance in the demand of the quality requirement of a specific product across markets.

SPS Measures Tweaked:

Generally demand for quality is relative to the purchasing power of the consumers. Higher our purchasing power, greater is our demand for quality. The people of developed nations possessing relatively higher purchasing power than their counterparts in developing and lesser developed nations; have forced their governments to import only products that conform to the highest quality standards.

The developing and lesser developed countries are found to be lacking heavily in maintaining the minimum reasonable quality expectations. Seizing this opportunity as an excuse, with the intention of protecting their domestic industry; the governments of developed countries have raised the bar of quality requirement to an extent, which can never be met by the developing and lesser developed nations in practical terms. Hence export of their produce to these countries becomes impossible for those countries that fail to conform to the quality requirement.

This is when a genuine, essential, quality standard becomes a trade barrier; chosen and implemented jealously by member nations; in an era of the Tariffs and Non-Tariff Barriers (NTB) removed. The irony is that, even the WTO has been left to its wits end in curbing the misuse of an essential quality standard as a trade barrier.

Argument of Developed Countries:

            Demand for safety and quality is highly individualistic and is directly proportional to the purchasing power of the people of the country. The locally produced product found to be of a better quality than the imported product serves ample justification for the level of quality conformance stipulated by the developed country on its imports. The countries though developed also possess infant industries that need to be protected from the onslaught of cheaper products from member nations. The SPS measure comes handy to the rescue of the developed countries to protect their infant industry.

           The foundation of stipulating a certain level of quality should rest on scientific evidence. The developed countries that have access to advanced technology to test and qualify the products overpower the developing and lesser developed countries that are yet to develop or gain access to the technological development.

Argument of Developing Countries:

            The developing countries face quality requirements from their developed counterparts such that they can never be possibly met in any practical terms. For instance; An Australian quality demand stipulates that for chicken meat to be imported from Thailand, it should be heated at 70 degree Celsius for 143 minutes to prevent the entry of certain disease via chicken meat. It is reportedly found that this treatment converts chicken to paper!

            The Japanese Vapour Heat Treatment (VHT) of fruits is another instance of SPS measure becoming a prime barrier to free trade among nations. The enormous investment demand for technological up gradation and the time associated with it for compliance; coupled with the risk of losing the market to competitors, has made this quality standard a potential NTB.

Role of WTO:

            WTO plays a vital role in fostering and promoting free and fair trade among member nations. When a member nation proposes a specific level of quality standard in the forum, ample opportunity is always provided for a reasonable debate for & against the proposed quality standard prior to its approval. The developing countries have miserably failed to participate and actively get involved in discussions pertaining to the implementation of a quality standard by a member nation.

            Also, since the developing and lesser developed nations have negligible or no access to technological support and knowledge on the implications of a specific standard proposed at the forum by a developed nation for implementation, they have a weak argument that fail to sustain. Also, it has always been a practice of the developing and lesser developed countries to raise alarm only upon material damage done to their exports to developed countries on the front of SPS standards.

Solution – Harmonisation of SPS Measures:

            History evidences that most of the detentions of imports from developing countries are for insanitariness; and most of the detentions from developed countries are for labeling and packaging requirements. The latter is easily corrected than the former; adds to the malice of the developing countries towards their developed counterparts.  

It has been found that both the developing countries and the developed countries have been misusing the very essential quality standard to their advantage, to protect their domestic industry. No wonder cases relating to SPS and resulting trade restrictions are piling in the Dispute Settlement Board (DSB) of the WTO. The ongoing events call for an urgent