Enabling growth of Asia’s food industry by reducing friction from standards and regulations

Food Industry Asia (FIA) has acknowledged the important role of the World Trade Organization (WTO) in reducing barriers to trade, and has encouraged companies and governments in Asia to work together to create an enabling environment for growth - to maximise the full potential of the food industry in the region.

Earlier this month, Bev Postma, Executive Director at FIA, participated in a special multi-stakeholder dialogue on Technical Barriers to Trade (TBT) hosted by the WTO TBT Committee to mark the 20th Anniversary of the WTO. The event, titled “TBT@20: Reducing Trade Friction from Standards and Regulations,” was held on 4 November in Geneva, Switzerland, and brought together more than 400 representatives from WTO Member States, as well as experts from the private sector and civil society.

In his opening remarks, the WTO Secretary-General, Roberto Azevêdo, looked back on the last 20 years since the signing of the TBT Agreement and reminded delegates that since 1995, the TBT Committee has received more than 25,000 notifications from its Members and quietly resolved 471 Specific Trade Concerns - covering toys, food, cars, electronics and cosmetics.

The Committee has helped governments avoid trade disputes and enhanced regulatory cooperation by developing best practices and sharing information and experiences. He explained that the purpose of this anniversary event was to take stock of the Committee’s work over the past 20 years, and look ahead to challenges on the horizon.

Panel moderator Devin McDaniels, from the WTO Secretariat, asked each of the panellists to answer the following three questions: Why does the TBT Agreement matter for you? How do you engage with governments and other stakeholders? And what are some of the challenges you face?

Responding to the first question on behalf of the food industry in Asia, Ms Postma explained that FIA was designed to work at the interface between the food industry and the Governments in Asia. “On average, we spend about one-third of our time working on key trade issues relating to TBTs and the harmonisation of standards,” she said. “The rest of our time is spent working on food safety issues and nutrition.”

Ms Postma highlighted that FIA’s Science & Technical Committee acts in a similar way to the WTO TBT Committee by bringing together the region’s top Regulatory Affairs professionals from different companies and countries to exchange ideas and best practices in a non-competitive arena. “In many ways, our regional committees are the private-sector equivalent of the public sector committees in the WTO” she said.

Based on feedback from both multi-national companies, as well as SME groups, from the 10 ASEAN countries, Ms Postma explained that the biggest trade challenges faced by the food industry in Southeast Asia are the simple differences between the regulatory requirements between countries – “a lack of alignment to international standards and the lack of harmonisation are causing unnecessary costs for businesses large and small and hampering their ability to move their products across borders”.

“The biggest problems we face relate to nutrition labelling; pre-market product registration; authorisation of food ingredients; additives and flavours; contaminant limits and analytical methods; and Import/Export certification,” said Ms Postma. “These barriers are covered by both the TBT Agreement and the Sanitary and Phytosanitary Standards (SPS) Agreement but is often difficult for food companies to engage directly with Governments and the WTO on these regulatory concerns.”

“The TBT and SPS Agreements were designed to facilitate Government-to-Government dialogue but they do very little to bridge the gap between the public and private sectors. For this reason, the food industry has created many non-profit industry associations like FIA to provide a vital interface between governments and companies.”

In Asia, industry-to-government dialogue is usually conducted at a national level on a country-to-country basis but FIA is also working with inter-government organisations like FAO, UNIDO and the World Bank at a regional level, to help developing countries scale up the transfer of knowledge and expertise. FIA also works with multi-lateral trade groups like APEC, RCEP and ASEAN to help them accelerate their own harmonisation goals.

Ms Postma pointed out that the ASEAN Economic Community (AEC) is scheduled to go live at the end of this year but the ten Member governments are still no closer to achieving harmonisation of food standards - or even mutual recognition agreements. This is despite the fact that the delay in integrating and harmonising food standards has been cited by economic ministers as the main reason why the agri-food sector is failing to meet its true potential. The food industry stands ready to help.

“Our analysis shows there is no lack of political will to harmonise standards and align them to international codes. In fact, our own white papers are regularly cited by Trade Ministers throughout Asia. The problem, we have discovered, lies in an apparent gap in priorities between the Trade community and the Regulatory community and the lack of resources between these two hardworking groups,” said Ms Postma.

Ms Postma concluded that by encouraging governments to work with companies in Asia, the WTO could take a number of steps to maximise the full potential of the food industry in Asia, including:

• Greater public-private collaboration and industry consultation on new and existing standards;
• A stronger coordinating role for the TBT Committee in engaging with the private sector;
• Enhanced cross-sectoral cooperation and capacity building for regulators; and
• Greater promotion of Good Regulatory Practice.

To see the full audio recording and image gallery for the WTO TBT@20 event, please click here

Ms Postma was part of the second Panel Discussion titled “TBT Stakeholders: Beyond Governments”, which was moderated by the WTO Secretariat. The other panellists were Pär Stenmark (IKEA), Dominique Taeymans (Nestlé), Jane Ngige (Kenya Flower Council), Dr Scott Steedman (British Standards Institution, BSI) and Sadie Homer (Consumers International).