Making Free Trade Safe

  • Dr Lockwood Smith
International Trade

Opening of 66th General Session
World Animal Health Organisation (OIE)
12 rue de Prony

Mr President, Mr Director General, Your Royal Highness, Ministers, Delegates, Ladies and Gentlemen.

Globalisation is making international organisations like the OIE ever more important. That puts extra responsibility on our shoulders.

Globalisation is not a policy choice of governments or international organisations. It is the inevitable byproduct of technological advancement during a time of peace. It is now possible to send vast amounts of money halfway round the world in a second. It is possible to send people and goods halfway around the world in a day. Services and information can be provided via the Internet which cannot be regulated or controlled by governments in the way we have tried to regulate and control trade in the past.

Our peoples generally support globalisation. They like the new opportunities it gives them. Ours is the first generation where we can genuinely be citizens of the world as much as citizens of our own countries. We can travel and do business where we like. We can purchase whatever goods and services we like, wherever they are produced.

It is the responsibility of governments to maximise the benefits of globalisation. By and large we are. The World Trade Organisation agreed last week that negotiations to liberalise trade in agriculture would begin as mandated at the end of next year. Cairns Group countries and the United States are determined that those negotiations will lead to our objectives, including open market access for agricultural products.

While New Zealand is at the leading edge of global efforts to liberalise agricultural trade, we are also the most geographically isolated nation on Earth, and our economy is largely dependent on agriculture. That means we have a very strong interest in ensuring that global free trade is also safe trade. The importation of unwanted organisms, which could threaten our human and animal populations, is extremely damaging to us. We insist upon the right to maintain a very strict regime to protect our sanitary and phytosanitary status.

But we are equally insistent that SPS rules and regulations must be based on sound science and common sense assessments of risk. Through the WTO, we will not allow other countries to replace the tiny tariff quotas and huge tariffs of the past, with new barriers to trade based on phony science or political considerations. Such new barriers would undermine efforts to maximise the gains from globalisation.

Through the process of globalisation, consumers have access to more information than ever before. That is a good thing. But it is also a new phenomenon. Many consumers have difficulty assessing all the new information to which they now have access. The media, by and large, does not help, tending to sensationalise any new research or public comments which suggest even the tiniest of risks, particularly if the possible problem was previously unknown.

The BSE scare in the United Kingdom was a classic case. It has had, and continues to have, a negative effect on world trade. Obviously, there was a need for a response to the problem. Public health must be paramount. But the policy response must be proportional to the risk. Many of the public no doubt believed that the risk they were facing was considerable when in fact it was lower than other food borne risks. We must show leadership in terms of education, and not contribute to, or develop policies on, irrational fears.

Today, our governments are spending vast sums on BSE surveillance programmes. Those surveillance programmes are for a disease that is so hard to detect that we cannot be sure they are effective. And they are for a disease that, if it were present in other countries, could have an incidence rate lower than one in a million. What's more, the casual link between BSE and any human disease is tenuous. The risk to human health from eating beef is so low that the word in everyday, layman's language which most closely describes it is "none". Given the extent of the UK's BSE programmes, the risk there could also be described as "none".

Despite that, the cattle testing programmes being proposed here in Europe cost up to GBP 20 per animal. That is money that, in terms of protecting human health, is achieving almost nothing. Far better for countries without BSE to divert that expenditure to surveillance programmes for diseases like new strains of type A foot and mouth, salmonella enteriditis or CBPP. These are far more prevalent, and demonstrably and inarguably present a greater risk.

This organisation must show leadership as we move to a globalised and free trade world. Any animal health measures which conform to OIE standards are deemed to conform to the WTO's SPS agreement. The OIE therefore has an important role in helping to provide certainty in the multilateral trading system. That means it is vital that all OIE standards are based on sound science, common sense assessments of risk, and efficacy of tests. In everything we do and say, we must ensure we contribute to the public's understanding of risk, and resist the temptation to sensationalist.

It is also important, given the OIE's role in the multilateral trading system, that standards are flexible enough to take into account the speed with which technology is advancing. It can be counterproductive to overly prescribe standards. It is the outcome that is important.

New Zealand therefore advocates that, when developing new standards, the OIE ensure that countries can use systems which deliver equivalent outcomes. Should a more cost effective method be developed to screen for a particular disease, WTO members should be able to introduce it quickly, and still maintain a high degree of certainty that they are remaining within the rules of the SPS agreement. That would allow the flexibility that a fast changing world demands.

Along with the IPPC and Codex Alimentarius - organisations of the same WTO status - the OIE is one of the three fundamental organisations which underpin the multilateral trading system. The OIE should lead efforts to ensure SPS measures are based on science and common sense, so that they are least trade restrictive. In doing so, we can add much needed certainty to the system.

New Zealand remains dedicated to the work of the OIE. Thank you for the opportunity to take part in your opening ceremony. I look forward to a successful outcome from the 66th general session.