Accelerating adoption of genetically modified crops in Africa through a trade liability regime

Abstract

Given the apparently unbridgeable divide that has developed between the 25 odd countries that grow and trade GM crops and the evolving EU regulatory hurdles, it may be time to consider alternative strategies for realizing a global market for agricultural products. Africa is one area of the world where the battle over GM agriculture is being played out, yet it is the continent where GM could have the greatest positive impact. Numerous African nations, given their long-standing trade connections to European nations, fear that allowing the commercialization of GM crops could lead to comingling of GM and conventional products and, hence, the loss of export opportunities to the EU. These are legitimate concerns. One potential solution that warrants serious consideration would be to establish a pool of funds that could be accessed by African agricultural commodity exporters in instances where exports to Europe are rejected. A production levy could be imposed in leading industrial adopting nations (i.e., Australia, Canada and the United States). The revenue raised would provide an endowment fund that could be used to offset the costs arising from import refusals. African-sourced shipments rejected by the EU will most certainly have alternate markets, but could receive a reduced price or incur higher costs associated with serving alternate markets. The intent of the fund would be to compensate for the real difference between the net returns contracted with European importers and the final market price received. This article examines the feasibility of establishing such a fund and discusses the funding options.