Research Reports
Case Study of SPS Systems, Disputes, and Risk Analysis for Advanced Korean SPS System
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AuthorChoi, Seikyun
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Publication Date2003.09.01
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Original
The objective of this study is to review the Korean sanitary and phyto- sanitary(SPS) system as well as some major countries' SPS system as a benchmark to the future Korean system. Risk analysis and SPS dispute cases have also been analyzed to develop a desirable risk analysis system and prepare possible SPS disputes. Contents of the report are evaluation of SPS agreement and prospects of the SPS committee, review of the Korean SPS system, review of the major countries' advanced SPS system, risk analysis, three cases of SPS related dispute, and policy implications and recommendations.
The SPS agreement has been evaluated to give positive impacts on international agricultural trade through restricting unjustified import bans. The SPS committee focuses on the issues of improvement of transparency, better understanding and implementation of the rules by especially developing countries. Food exporting developed countries including the U.S.A. and Australia do not wish to revise the SPS agreement at this moment. Thus negotiations for the revision of the agreement are not expected to be held in the near future and Korea needs to develop fundamentals of the SPS system to prepare future SPS negotiations and SPS dispute.
Korean SPS system has no serious problems in terms of inspections for exports but needs to develop the system to handle import commodities enough not to allow inflow of vicious virus, insects and contaminated food to protect agriculture, environment and health. Non-indigenous insects and virus came into Korea found to be 55 species and have brought serious damage economically and environmentally. Damaged agricultural land by foreign insects and virus reached to 550 thousand hectare in 2002. Foot and mouth disease(FMD) broken in 2002 brought another serious damage and it costed 160 thousand heads of swine.
The cases of phyto-sanitary inspection show increasing trends as the cases of inspection increased from 71 thousand in 1993 to 359 thousand in 2001. During the same period, the cases of inspection per phyto-sanitary official also increased 2.8 times and reached to 1,182 in 2001. In Japan, phyto-sanitary inspection officials, on average, handled 925 cases in 2001. Demand for SPS measures is expected to increase as market opening expands and member countries of the WTO increase. In order to minimize the risk of exposing human health, agriculture, and environment to vicious insect, virus and contaminated food it is necessary to increase SPS budget and develop SPS system.
Risk analysis becomes the core in SPS dispute settlement process and in imposing SPS measures. In order to develop an advanced risk analysis system, we need better risk analysis teams, increased communications between trade negotiation teams and SPS teams, cooperation among experts in the field of food technology, ecology, toxicology, statistics, and economics. Cooperation and communication between the central government and the local government or among the local governments are desirable. Not only border SPS measures but also pre-border measures and post monitoring system need to be developed and linked closely.
SPS measure have characteristics of a public good and require shared responsibilities among the government, importers and citizen. Importing companies need to share cost of inspection, travelers can be fined when they violate SPS regulations such as carrying some food which is not allowed, and incentives need to be allowed for people who contribute to prevent contaminated commodity imports. Advanced technology including X-ray detection, detection dogs, statistical analysis for optimization of human resources needs to be adopted and developed.
WTO/SPS dispute panel costs a lot in terms of money and human resources, thus bilateral negotiations are recommended prior to appeal to the dispute settlement body(DSB). Majority of the DSB members consists of diplomats instead of scientists and trade negotiation attorney's role becomes more important. Cooperation among scientists for research, government officials for imposition of SPS measures, and diplomats or attorneys is essential to construct an efficient SPS system. Information on SPS measures, dispute and regulations should be shared by government officials, traders, consumers, and producers.
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