The Economics Of Quarantine And The Sps Agreement

Reviews of quarantine policy are becoming increasingly sophisticated under the Uruguay Round (SPS) Health and Plant Health Measures Agreement and, in the case of Australia, according to the 1996 Nairn report. Nevertheless, they continue to focus primarily on the impact of restrictions on only competing producers. A more comprehensive analysis, including consumers, shows that even if imported diseases wiped out a local industry, the benefits to consumers could outweigh the losses suffered by competing import producers by lifting an import ban. This document provides the simplest framework for partial balance to think more about the cost-effectiveness of quarantine measures. An empirical analysis of Australia`s ban on banana imports, used to illustrate the methodology, suggests that a transition to free trade may well lead to a significant reduction in banana cultivation in Australia, but the economic benefits of welfare to consumers will almost certainly outweigh the losses suffered by producers. The paper concludes by arguing that there is a need for a comprehensive economic review of Australia`s countless quarantine restrictions. 2. Integration of the economy into the SPS`s risk management policy: themes and challengesDonna Roberts DOI: PART III – Uruguay`s round of multilateral trade negotiations, culminating in the transformation of the GATT secretariat into the World Trade Organization (WTO) on 1 January 1995, changed the quarantine process of national governments forever. At the same time, national governments around the world are under pressure from their constituents to take into account more rational economic thinking in all areas of policy-making. Quarantine policy is not immune to this pressure for better economic governance. Nevertheless, the SPS agreement seems to ignore important economic dimensions of quarantine policy, particularly the cost to consumers of this policy. Perhaps this reflects the fact that quarantine agencies (provided by the authors of the SPS agreement) have focused their attention on the scientific aspects of quarantine and have not consulted economists, even as consultants, and it is partly for this reason that the economic profession has paid little attention to quarantine issues in the past. The uruguay round multilateral trade negotiations, which culminated in the transformation of the GATT secretariat into the World Trade Organization (WTO) on 1 January 1995, forever changed the process of quarantine of national governments.

On the one hand, WTO Member States retain the right to protect the lives and health of their people, plants and animals from the dangers posed by animals and animals, such as pests and diseases, that result from the importation of goods. On the other hand, the WTO agreement on health and plant health measures (SPS agreement) requires that quarantine measures be defined in a transparent, coherent, scientifically justified and less restrictive manner.