Meeting Sanitary and Phytosanitary (SPS) Standards: What Can China Do?

AUTHOR

Fuzhi Cheng

CITATION

Fuzhi Cheng (2007). Case Study #10-10, "Meeting Sanitary and Phytosanitary (SPS) Standards: What Can China Do?". In: Per Pinstrup-Andersen and Fuzhi Cheng (editors), "Food Policy for Developing Countries: Case Studies." 14 pp.
URL: http://cip.cornell.edu/dns.gfs/1200428209

EXECUTIVE SUMMARY

It is widely recognized that rising sanitary and phytosanitary (SPS) standards have created numerous obstacles to the international exchange of agricultural commodities. The issue is of particular importance for developing countries with abundant agricultural resources as they seek to expand their exports of labor-intensive, high-value-added agricultural products to the more lucrative developedcountry markets. Agricultural exporters in developing countries are often required to meet stringent developed-country SPS standards. Not only are these standards much higher than international standards and those prevailing in developing countries, but they are also subject to frequent (usually upward) revisions.

China is a large agricultural producer and exporter. As China’s agricultural trade continues to increase, the country has experienced more challenges in meeting the SPS standards set by its trade partners. While some of the SPS standards are legitimate and necessary for protecting human, animal, and plant health, others are considered to be disguised forms of protection. Concern in China has grown that technical regulations such as the SPS standards are increasingly being used to discriminate against some of its exports. The European Union (EU), Japan, and the United States are the three markets in which China has encountered the most SPS barriers.

Because of the difficulty of challenging foreign SPS barriers, it is considered more practical to meet these high foreign standards. To this end, China has enacted many laws and regulations on food and agricultural production. Despite efforts, many problems exist in China’s food safety regulatory system. First, domestic food regulations are usually not consistent with or are less restrictive than international standards. Second, there is little coordination among the various government ministries and agencies when they establish agricultural standards and food safety controls. Third, the lack of technical, institutional, and managerial capacity to control and ensure compliance makes the regulations and standards ineffective.

Capacity building in both the public and the private sector will help China move toward better food safety status and create more trade opportunities. The private sector, including the farm sector, has the main responsibility for producing and selling safe food. Attracting more foreign direct investment (FDI) and establishing Hazard Analysis and Critical Control Point (HACCP) systems and coordinated supply chain management in agriculture should be the main focus. The government, however, sets the framework within which the private sector operates, and the role of the public sector in organizing public services and promoting food safety should be emphasized.

Your assignment is to develop strategies that China can use to enhance its capacity to meet food export quality standards, taking into account the financial, institutional, and technical constraints it is facing.

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