MANAGING RISKS IN WORLD TRADE IN BEES AND BEE PRODUCTS

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1 MANAGING RISKS IN WORLD TRADE IN BEES AND BEE PRODUCTS Andrew MATHESON International Agreements Manager Biosecurity Authority, Ministry of Agriculture and Forestry PO Box 2526 Wellington, NEW ZEALAND Abstract World bee health continues to deteriorate as pests and diseases are spread internationally. Causes include legitimate trade smuggling and well-intentioned but misinformes bee introductions by professionals. New world trade rules strengthen the ability of many countries to protect bee health while trading but also carry obligations. Countries that are members of the World Trade Organization can only restrict imports to protect against identifiable health risks Healthprotection measures cannot be used to discriminate against imports in favour of local products or between different exporting countries of similar health status. If imports are safe the trade must be allowed to proceed. Whether there are any benefits to the importing country is left to the consumer to decide it is not a government decision. These new trading rules have given much more importance to the bee health standards developed by the OIE world organization for animal health. Keywords: International trade / honey bee / bee product / disease / pest / World Trade Organization / Office International des Epizooties 1. International Trade For thousands of years, and since humans first began to exploit honeybees, both products and bees themselves have been commodities to be traded. In the past few centuries, this trade has become worldwide as bees and their products have been shipped between continents. Such commerce has increased considerably in the past few decades. In the future, we can expect trade in bees and their products to continue to increase, as technology makes transport easier and lowers national barriers to commerce. This trade brings benefits to exporting countries. Obviously, countries that can produce a surplus can find markets overseas, and may be able to sell at a profit much more than their domestic population can consume. Countries which are still net importers oh honey, and the USA is an example of this, can still find niche export markets for some of its products. The trade brings benefits to importing countries too. Consumers have a greater choice of product, sometimes at a lower cost. Having access to imported product might mean that consumers do not have to subsidise their local industry through a higher price for local product on a protected market. Beekeepers and bee breeders might also enjoy having access to a range of genetic material. This might increase their profitability, through access to higher-producing or disease-resistant stock. In this age of global competition, profitable beekeeping means smart beekeeping, and staying ahead of the game with new stock might be a key to some producers. It can even be argued that allowing legal importation of bees, under controlled conditions, might reduce the threat posed by illegal importations. There is, however, a downside to all of this. On health grounds, bee diseases continue to be spread throughout the world. This is despite us knowing a lot about the distribution of those diseases [1, 2], and how they are spread by the legal and illegal movement of bee products and live bees. The community of beekeepers and professional apiculturalists should be concerned about this continued spread of pests and diseases. Quite separate from health concerns, beekeepers are often, or even usually opposed to imports because they want to see their local markets protected from competitors in other countries. (Even beekeepers who make money from exports often want their domestic market protected from overseas competitors, while still having their export markets stay open.). It is important for countries to distinguish whether import restrictions on bees and bee products are there really to protect bee health, or to protect local producers from competition. Countries that are members of the World Trade Organization (or WTO) have agreed to trading rules that limit the extent to which international trade can be restricted in order to protect local producers. This framework of trade rules emphasizes the benefit to consumers and local economies from an open and competitive global market place.

2 2. Implications for Bee Health North America provides an interesting example of how industries have suffered from movement of pests and diseases. In less than the last 30 years there have been a number of cataclysms in North American beekeeping: chalkbrood in Utah, seen in honey bees in 1972; tracheal mites in Texas in 1984; Varroa, first seen in Wisconsin in 1987; and the small hive beetle, discovered in Florida as recently as And, though not a pest or disease in the strict sense of those terms, the Africanised honey bee arrived in This is happening on a world scale as well. The warnings have been apparent, about the seriousness of varroa and tropilaelaps for instance, yet still we have managed to shift varroa around most of the world and tropilaelaps to at least one other continent. It appears we aren t even learning from our mistakes. But with all these reports, whether for North America or on a global scale, it is important to rememeber one thing. Reports of the spread of pests and diseases usually give us no clues about the cause for their spread. It s not possible to blame free trade, or even trade at all, for this deterioration in world bee health. Looking at the North American examples, it s not certain how trade was involved. Authorities generally agree that varroa arrived in the US with illegal importations of queen bees. Smuggling is a different issue from free trade, and has been going on for far longer than we ve been talking about globalisation. It s also recognized that the tracheal mite arrived across the land border with Mexico. If a land border can t be sealed against human movements, how can honey bees be excluded? Both varroa and the Africanised honey bee arrived in the Americans through the deliberate movement of bee stocks by scientists and development workers. So deliberate movements, whether well-intentioned or through smuggling aren t really related to trade. And even those introductions which did come about through normal, legitimate trade, don t relate to free trade or to globalisation. For one thing, the significant introductions referred to above occurred before the World Trade Organization agreements came into force and fundamentally changed the rules affecting international trade. Once detected in a country most pests and diseases spread rapidly within that country, and across land borders, through both natural spread and beekeeper-assisted movement. There has been a deterioration in bee health in many countries in the world. The causes of this are varied: an inadvertent consequence of trade in bee products or bees; deliberate introduction of bee stocks, often by scientists; and smuggling, presumably by beekeepers. Trade is but one cause. 3. New Rules for World Trade in Bees and Bee Products 3.1. Protecting bee health when importing How can countries protect the health of their bees when importing stock or bee products? Do WTO rules mean that countries have to favour trade over health protection? This section of the paper outlines the WTO rules governing agricultural trade, because these have a significant effect on international trade in bees and bee products. It sets out the background to these rules, what differences there are from how countries could operate in the past, and what consequences there are likely to be for apicultural trade The SPS agreement There are now 135 members of the World Trade Organization, the WTO. They include most major trading countries in the world. Most countries that are not members, such as the People s Republic of China, Taiwan, Russia and Saudi Arabia, are in the process of negotiating to join the WTO. When they become members, they too will have to agree to abide by the WTO rules. Members of the WTO have agreed to base their regulations for protecting animal health on scientific principles, and not use them inappropriately to restrict trade or to protect domestic industries. The WTO agreement that contains the rules for this area is called the Agreement on the application of sanitary and phytosanitary measures, usually referred to as the SPS agreement [4]. The SPS agreement is about how to apply sanitary measures (which are measures to protect human health and animal health) and phytosanitary measures (measures to protect plant health).

3 Sanitary measures are anything which restrict trade in order to protect animal health, or bee health in this case. They include such things as inspection, testing, certification, heat-treatment, sourcing products from particular disease-free areas, right up to an outright ban on importation. Because the SPS agreement is so important when WTO member countries set rules to protect their bee health from imported goods, this paper outlines its provisions. Although the agreement covers all animal health, plant health and some aspects of food safety, it uses bee health as the example in the rest of this talk. There are a number of key principles of the SPS agreement are outlined below. Necessity of SPS measures WTO members have the right to protect their bee health, provided the measures taken aren t inconsistent with the SPS agreement. So national sovereignty is preserved, but balanced against the commitments made when members committed themselves to the WTO. This balance, really, is the key to understanding the whole SPS agreement. The SPS agreements defines necessity by reference to science rather than politics, as sanitary measures must be based on scientific principles and kept in place only while justified by scientific evidence. Consistency Sanitary measures must be applied consistently, and there are two main aspects to this: Firstly, discriminating against foreign suppliers is not allowed. This so-called national treatment principle means that imports cannot be treated differently from local trade in the same commodity. For instance a country cannot require imported bees to be free of a disease if there is no similar requirement for locally-traded bees. The second principle of consistency means that WTO members can not discriminate between imports from other WTO member countries where identical or similar health conditions prevail. An example of this would setting tough health standards for imports from one country while being more liberal with imports from another, without valid health reasons for doing so. Assessment of risk Unless an international standard is used, WTO members must ensure that their sanitary measures are based on an assessment of risk. Before imports can be restricted or prohibited, there must be a clear and identifiable risk to the bee health of the importing country from the particular commodity being exported or considered for export from a given country. Risk assessment or risk analysis is a fast-evolving science which helps regulators assemble data in a through and consistent way, so their decisions can be made on a sound technical basis. The process also becomes more transparent so anyone affected by a decision can see the assumptions and decisions made in developing sanitary measures. When doing risk analysis for bee health, the risk analysis methods developed by the world organization for animal health, the OIE, should be followed. Once the risk analysis has been performed, regulators must decide the sanitary measures that are necessary to dealt with the likelihood of a pest or disease being introduced or becoming established and the consequences of that happening. Risk analyses must consider the risk to the importing country s bee health that might be posed by importation. The benefits to that country must not be a consideration in deciding whether to allow imports. If the importation can be made safe, then trade should be allowed. It s up to consumers in the importing country to decide if there s a benefit from the trade, not the government. Least trade restrictive Given a choice of sanitary measures which will deliver the level of health protection deemed appropriate by the importing country, WTO members must choose the one which will have the least restriction on trade. Equivalence The agreement also forces a move away from importing countries insisting that particular sanitary measures be applied to animals or animal products. Different health measures used by an exporting country

4 must be accepted by an importing country, if it can be objectively shown that they achieve the importing country s appropriate level of protection. For example, an importing country could not insist that beeswax was heated at a certain temperature for a certain time, to protect against EFB, if the exporting country could show that another treatment (say irradiation) delivered the desired level of protection. Harmonisation Harmonising sanitary measures is an important objective of the SPS agreement, and members are, in general, obliged to base their sanitary measures on international standards, recommendations and guidelines where they exist. For animals health the international standards are those developed by the OIE, the Office International des Epizooties or the world organisation for animal health. The OIE now has a much more important role than it did in the past. Now its recommendations have a new status, and it is vitally important for countries to work to make these scientifically valid and up to date. Regional conditions Sanitary measures should take account of demonstrable regional variations in health status in the exporting and importing regions. It is no longer appropriate to think of a whole country as being infected with a disease, if there are real differences in the presence or incidence of that disease within the country. This means, foe example, that imports could be permitted from part of a country with a better health status, but not permitted from other parts of that country. But to support a claim that a region is free of a disease or has a low incidence of a disease, a country must provide objective evidence on issues such as effective surveillance, import control measures, and geographical or ecological factors maintaining the disease status. Transparency Probably the most immediate change in the way countries operate in the environment created by the SPS agreement has been an opening up of information channels about the sanitary measures they use; commonly called transparency. WTO member countries are obliged to notify other members of proposed sanitary regulations, and allow time prior to implementation for comment (except for emergencies such as outbreaks of serious diseases). Other countries are entitled to comment, and have their submissions discussed. WTO members must also set up single enquiry points, so that any other member may ask about a wide range of sanitary measures including SPS regulations, internal procedures such as manuals used by inspectors, and even the risk analysis procedures used to develop import health standards. Other provisions The SPS agreement also contains other provisions on issues: - technical assistance for developing countries; - special and differential treatment for developing countries; - it s also worth pointing out that least developed countries which joined the WTO when it was formed on January 1, 1995, didn t have to fully comply with its provisions for five years; - there is an SPS committee, made up to representatives from all member countries, which is charged with helping to implement the agreement; - the WTO has formal dispute settlement procedures The Office International des Epizooties What is the OIE? The OIE (Office International des Epizooties) is the world organisation for animal health. This organization was established by international agreement in 1924, and now has over 125 countries and territories as members. The OIE has three main aims, to: - promote and coordinate research on contagious diseases of production animals;

5 - collect and disseminate information on animal disease; - harmonise regulations governing international trade in animals and animal products. The OIE Code The OIE publishes the International animal health code [3], which is used as a basis for drafting veterinary regulations governing both the import and export of animals and animal products. The Code sets out definitions and basic principles of disease control measures. Using the Code to harmonise trade requirements will facilitate trade by avoiding unjustified barriers. New status of the OIE Code In the past the OIE Code has been available for OIE member (and other) countries to use, but there was no obligation for regulatory officials to follow its procedures. From 1995, under the SPS agreement, a new status was given to the OIE and its documented procedures. Harmonisation WTO member countries are obliged to follow the OIE Code, say for regulations for protecting bee health which might affect international trade. Following the OIE Code is no longer simply an option for WTO members. And all sanitary measures based on OIE standards are deemed to be acceptable under the SPS agreement (though of course they still must be applied in accordance with the principles of the agreement). Deviation from the Code WTO members may introduce or maintain sanitary measures which result in a higher level of sanitary protection than would be achieved by following the relevant international standards, guidelines or recommendations, only: - if this is scientifically justified, or; - to achieve a level of sanitary protection which is determined to be appropriate by a formal risk analysis. Even so, these sanitary measures which deliver a higher level of sanitary protection must be consistent with the remainder of the SPS agreement. Coverage of honey bee diseases The five diseases of honey bees that are covered by the OIE Code at present are what it terms. - acariasis (infestation with the honey bees tracheal mite Acarapis woodi); - American foulbrood (Bacillus larvae); - European foulbrood (Melissococcus pluton); - nosemosis (Nosema apis); and - varroasis (Varroa jacobsoni). The range of honey bees diseases covered by the OIE Code, and the content of relevant sections of that document, are currently under revision by the OIE. Proposed coverage on honey bee diseases Under this proposal the coverage of diseases would be substantially the same, with updated terminology, and the addition of Tropilaelaps species and other Varroa species: - tracheal mite infestation (Acarapis woodi); - American foulbrood (Paenibacillus larvae larvae); - European foulbrood (Melissococcus pluton); - nosemosis (Nosema apis); - varroosis (Varroa spp.); - tropilaelaps (Tropilaelaps spp.).

6 New principles in the OIE Code In undertaking this revision, real effort was taken to incorporate the principles of the SPS agreement. Some of these principles, which we ve incorporated in the honey bee chapters of the Code revision, include the following: - countries can choose the sanitary measures to be used to mitigate against risk according to the disease status of the exporting country; - where no measures are warranted, for instance if a disease is present in the importing country but not under official control, a specific recommendation is made not to impose sanitary measures; - post-arrival quarantine is recommended as a safe way of importing bee stock, as is used successfully by countries such as Australia and the USA; - the concept of area freedoms is no longer used; - the use of incubation periods is restricted, and defined more tightly; - sanitary measures are included for the importation of bee products and beekeeping equipment; previously the Code only dealt with trade in live bees; - more attention is paid to the basis on which exporting countries give assurances about the health status of exports. This revision, developed by New Zealand as part of its contribution to the work of the OIE, is only at the draft stage and is currently being considered by the veterinary authorities in all OIE member countries. Bee pathologists and beekeeping regulatory officials are encouraged to take an interest in this revision, and contribute expertise. 4. Likely Effects of the SPS Agreement on Trade in Bees and Bee Products 4.1. Unjustified requirements Importing countries are still requiring exporting countries to provide assurances that are not justified. One example is that live bee exports must often be tested for, and found free of, diseases which are present in the importing country but not under statutory control. That discriminates against imports in favour of locally-traded bees, which don t have to meet the same freedom requirements. A second example is countries requiring processed honey or beeswax to be certified as originating in apiaries which are free of parasites which cannot be transmitted in those products (such as tracheal mite and varroa). These regulations cannot be justified in light of obligations under the SPS agreement. A third example is where countries refuse imports because they don t consider there to be enough benefits to the importing country. Remember that trade may be restricted on health grounds only where there is an identifiable risk to be managed. It is up to customers in the importing country to decide if they want to purchase imported goods, not the government Unsustainable regulations WTO members must bring their national legislation into line with their commitments contained in the SPS agreement. WTO member countries made a sovereign decision to join the WTO, and that means complying with the rules. For instance, it is not fulfilling these commitments to allow importation of honey bees only from countries that are free of disease or parasites harmful to honey bees. This blanket ban does not allow the importing country to fairly assess risk and determine an appropriate level of protection to be achieved through applying sanitary measures. Health-protection measures must be: - based on a risk assessment; - restricted to those necessary; - and applied without discrimination. Domestic legislation that doesn t measure up to these criteria is now open to challenge by other WTO members, if they are thought to unjustifiably discriminate between members or against imports Trade opportunities New trade opportunities are likely to come from three main areas: - New markets. Previously closed markets will be opened up as trade policies are brought into line with SPS principles.

7 - Lower compliance costs. The costs of meeting unnecessarily rigid sanitary requirements can marginalise an otherwise viable export operation. As unjustified requirements are removed, these costs will be reduced. - Certainly. Exporters will be able to plan ahead with more confidence, as WTO members countries are no longer allowed to impose arbitrary restrictions on another country s export industry. 4.4 Implementation Although these rules came into effect nearly five years ago. I have to say that world adoption of SPS principles has not happened overnight. But gradually this agreement will lead too trade in bees and bee products being based on sound science. It has already begun to influence the bahaviour of regulators around the world, shifting the burden of proof on to those setting sanitary measures for imported bees and bee products, and not on those knocking on doors for market access. (The SPS agreement provides for trade to go ahead unless there are valid health reasons for it to be restricted, rather than for trade to be permitted only when this suits the importing country.) 5. Challenges for Apiculture 5.1. Beekeepers There s some tough challenges for beekeepers ahead. The biggest is: Stop complaining about trade realities, and get organized to maximize your business profitability. If necessary change the mix of products you produce. Add value. Don t assume you ll always have a market for what you ve sold in the past. Take charge of your own marketing. Be prepared and equipped for the inevitable changes in the world trade in bees and bee products Beekeeping regulators For beekeeping regulators, and for beekeepers too. Be prepared for new incursions of pests and diseases. They have happened for decades, and no doubt will continue to happen. For instance, probably not many ordinary beekeepers in Europe had heard of varroa in the early 1970 s, just as few beekeepers in North America had heard of the small hive beetle five years ago. But this has nothing to do with free trade. We don t, of course, have free trade. We have moved to a new era of rules-based trading. The challenge now is to accept the far greater movement of people and goods around the world, and support the development of scientifically sound rules to facilitate trade while protecting bee health. We must strengthen surveillance and monitoring systems. It is essential that not only do we have safe products, but that we have the monitoring systems to assure importers of the continued status of our product. Countries must have good evidence of their pest or disease freedom before they can justify import restrictions. Often the temptation is to cut down on inspection and surveillance capabilities as diseases are eradicated or brought under control. In fact the trend should be the opposite. Strong border control and internal surveillance are necessary to protect the investment made in disease eradication, an ensure others of a country s continuing health status Scientists And that leads to a challenge for scientists, as the rules for health protection are clearly now based on science. You must learn to use risk assessment methodology and apply it in practical ways. This should make it more difficult for politicians to play games while hiding behind risk assessment decisions. If technical experts can give clear and transparent conclusions from risk assessment, any potential political changes are clearly seen for what they are. Scientists should also actively contribute to the work of the OIE, by providing technical expertise and resources so that necessary standards can be developed to allow for further elimination of trade barriers.

8 6. Conclusions 6.1. World bee health For centuries there has been a deterioration in world bee health, as pests and diseases have been spread around the world. Sometimes the spread has been a consequence of what we could call legitimate trade, but often it has been the result of smuggling or well-intentioned, but misinformed, introductions by professionals World trading rules We don t have free trade, but do now have a new set of powerful rules to protect bee health in trade. They give countries every opportunity to protect their bee health. But these rules carry some tough obligations, too. Countries that are members of the World Trade Organization can only restrict imports to protect against identifiable health risks. And there must be a scientific basis to the assessment of risk. Healthprotection measures can t be used to discriminate against imports, or between different exporting countries of similar health status. And if imports are safe, the trade must be allowed to proceed. Whether there are any benefits to the importing country is left to the consumer to decide it is not a government decision. These new trading rules have given much more importance to the bee health standards developed by the OIE, the world organisation for animal health. 6.3 Challenges For beekeepers, the challenge is to adapt your marketing to an era of potential global markets and global competition. For beekeeping regulators, the challenge now is to accept the far greater movement of people and goods around the world, and support the development of scientifically sound rules to facilitate trade while protecting bee health. For scientists, the rules for health protection need to be based on your research. Learn to use risk assessment methodology, and apply it in practical ways. Contribute to the work of the OIE, and support its standards development. REFERENCES [1] Matheson, A., World bee health report. Bee World 74(4) (1993), [2] Matheson, A., World bee health update Bee World 77(1) (1996), [3] Office International des Epizooties International animal health code mammals, birds and bees. Office International des Epizooties, Paris, France, 1999, 468 pp (8 th edition) [4] World Trade Organization Agreement on the application of sanitary and phytosanitary measures. In World Trade Organization (ed). The results of the Uruguay Round of multilateral trade negotiations. World Trade Organization, Geneva, Switzerland, 1994, pp