SPS Balance Sheet For Vietnam - Standardsfacility
SPS Balance Sheet for VietnamStrengthening links between supply and demand ofSPS-related technical assistance in a sub-group ofASEAN countries (Stage 2)Research work for the Standards and Trade Development FacilityKees van der MeerLaura L. IgnacioThis report reflects the views of the authors alone and does not represent theviews of the STDF or any of its partner agencies or donors.1
Abbreviations and o PDRLDCMARDMOHMOSTMultiMUTRAPASEAN-Australia Development Cooperation ProgramAustralian Centre for International Agricultural ResearchAyeyawaddy-Chao Phraya-Mekong Economic Cooperation StrategyAsian Development BankAvian and Human Influenza FacilityAvian influenzaAsia-Pacific Economic CooperationAnimal and Plant Health Inspection Service (United States)Asian Productivity OrganizationAssociation of Southeast Asian NationsAustralian Agency for International DevelopmentCanadian International Development AgencyCambodia, Lao PDR, VietnamCambodia, Lao PDR, Myanmar, VietnamClassical swine feverDepartment of Animal HealthDanish International Development AgencyDiagnostic Trade Integration StudiesEuropean CommissionEuropean Technical Assistance Programme for Viet NamEuropean UnionFood and Agriculture Organization of the United NationsFoot and mouth diseaseGood agricultural practiceGross Domestic ProductGood hygienic practiceGood laboratory practiceGood manufacturing practiceGreater Mekong Subregion, includes Cambodia, China (Yunnan Province andGuangxi Zhuang Autonomous Region), Lao PDR, Myanmar, Thailand and VietNamGerman Technical CooperationHazard Analysis and Critical Control PointsHo Chi Minh CityHighly pathogenic avian influenzaIntegrated Framework for Trade-Related Technical Assistance to least developedcountriesIntegrated pest managementInternational Plant Protection ConventionInternational Standards for Phytosanitary MeasuresJapan International Cooperation AgencyLao People’s Democratic Republicleast developed countryMinistry of Agriculture and Rural DevelopmentMinistry of HealthMinistry of Science and Technologymulti-countryMultilateral trade assistance project2
NDNAFIQADNewcastle DiseaseNational Agro-Forestry and Fisheries Quality Assurance DepartmentNAFIQAVED National Fisheries Quality Assurance and Veterinary VFAVINAFOSAVinafruitWBWHOWTONorwegian Agency for Development CooperationNational plant protection organizationNew Zealand’s International Aid & Development AgencyOrganisation for Economic Co-operation and DevelopmentOffice International des Epizooties or World Organisation for AnimalHealthPhytosanitary capacity buildingPlant Protection DepartmentPlant QuarantinePest risk assessmentRegional partnerships schemeSoutheast Asian Foot and Mouth Disease Control ProgrammeStandards, metrology, testing and qualitySanitary and phytosanitaryThe Sanitary and Phytosanitary Capacity Building ProgramDirectorate for Standards and QualityStandards and Trade Development FacilityTechnical assistanceTransboundary animal diseaseTechnical barriers to tradeTechnical Cooperation Programme, FAOUnited Nations Industrial Development OrganizationVietnamese Association of Seafood Exporters and ProducersVietnamese Chamber of Commerce and IndustryVietnam Food AdministrationVietnam Food Safety AssociationVietnam Fruit AssociationWorld BankWorld Health OrganizationWorld Trade Organization3
1.Introduction1.The objective of this STDF research work is to strengthen the linkage between "supply"of and "demand" for technical cooperation in the area of food safety, animal and plant health(collectively known as sanitary and phytosanitary or SPS) requirements. As such, this research isbeing carried out in the framework of the broader Aid for Trade initiative. The work builds onexisting capacity assessments in the SPS area conducted by international organizations such asthe Food and Agriculture Organization (FAO) and the World Bank, as well as other studies andreports. It is not a new capacity evaluation, but rather an attempt to consolidate the results ofprevious studies. Progress in the implementation of findings of previous assessments were takeninto consideration as well as evolving priorities as reported by the stakeholders during aconsultative mission on 6-12 March 2008.2.This report presents a balance sheet of SPS needs and supply of technical cooperation forViet Nam. Similar balance sheets are being developed for Cambodia and Lao PDR. The aim ofthis report is to strengthen the link between supply of and demand for SPS-related technicalcooperation by:2. acting as a vehicle for information sharing on needs evaluations and ongoing and plannedactivities; and identifying gaps where they exist and further mobilizing the provision of capacitybuilding resources as necessary.Overview of SPS needs3.The World Bank estimates that total losses to the Vietnamese economy from SPSproblems surpass US 1 billion per year. Losses are concentrated on three main areas: publichealth, agricultural health and lost market access. Food-borne pathogens and high level of toxinsin foodstuffs, plant pests and animal diseases (including highly pathogenic avian influenza orHPAI) are the main problems faced.4.The highest profile public health risk from SPS problems is that related to HPAI. Of the106 human cases of HPAI reported since 2003,1 52 have been fatal. According to WHO data, fiveHPAI fatalities have been reported since January 2008. The disease burden from food-bornepathogens is lower in profile and harder to estimate, but may be as high as 1.5 cases of diarrhoeaper person per year, with 20 per cent of those cases requiring medical attention. Sources of foodcontamination include biological pathogens and chemical agents. Of particular concern areproblems with pesticide residues and health concerns related to the inappropriate application offarm chemicals. Overall, the total cost to the economy of food-borne disease is estimated tosurpass US 450 million per year (not including HPAI effects).5.Plant pests and animal diseases cause direct economic production losses. Fruit flies,coconut beetles, udbatta disease, sugar cane white grub, powdery scab and borrowing nematodesall negatively impact fruit and vegetable production. HPAI, classical swine fever (CSF), foot andmouth disease (FMD), Newcastle disease (ND), sheep and goat pox and rabies in turn affectproductivity in terrestrial animal production. Production in the aquatic animal sector is hamperedby white spot syndrome virus, yellow head virus and Taura syndrome virus in shrimp and red1Cumulative number of confirmed human cases of avian influenza AI (H5N1) reported to the WorldHealth Organization (WHO), 17 April 2008.4
spots in catfish. According to World bank's estimate, direct production losses surpass US 400million per year.6.Viet Nam's export oriented growth strategy has turned it from a net food importer to aleading exporter. Agricultural growth has averaged between 3 and 4 per cent for much of the lastdecade, but agricultural export growth has been running at a much higher rate, at approximately14 per cent per year. Principal products include rice, fisheries, coffee, fruit and vegetables,cashews, pepper, and tea. The one exception has been livestock products where, as a result of acombination of high domestic demand and the domestic disease situation, exports have declinedsince 1997.7.Despite high rates of agricultural export growth, SPS issues exert a break on furthergrowth, in particular in the context of diversification and penetration of higher income markets(with typically more stringent SPS import regimes). HPAI has curtailed already declining poultrysales. Classical Swine Fever (CSF) and FMD are also major constraints on exports of pigmeat.Few countries will trade in meat and meat products with Viet Nam - typically only those with asimilar animal health status and often then on an informal basis.8.In the fruit and vegetable sector, the World Bank has estimated that the fruit fly situationin the country deprives Viet Nam of access to a potential market for tropical fruit estimated atover US 250 million. Aquatic diseases create market access difficulties for prawn exports toAustralia. Despite improvements after an incident in 2001 involving banned antibiotics in shrimpexported to the EC, recent data2 confirmed cases of border interceptions of shrimp containingprohibited veterinary drugs. An EC Food and Veterinary Office report noted the lack of aneffective control system for veterinary medicinal products. (Given that the export of fisheryproducts are projected to reach US 4 billion by 2010, SPS compliance issues must be carefullymonitored). The same issues with veterinary medicinal products arise also for honey and royaljelly.9.There are many diverse gaps in SPS capacity in Viet Nam due to the country’s large size,its diversified agriculture and decentralized administrative system. Unfortunately, there is noreadily available general overview of all these gaps. The World Bank Action Plan listed a seriesof gaps, but there has been no monitoring or periodic update of the status of these and otherneeds. It is clear, however, major gaps of a strategic nature remain in: (1) the legal andinstitutional field; (2) designing risk-based monitoring and surveillance systems;(3) inspection and diagnostics; and (4) the control of various animal and plant pests and diseases.3.Overview of ongoing and planned donor assistance10.Significant progress is being made by the Vietnamese authorities in tackling theaforementioned issues with assistance from the international community. Viet Nam may beconsidered a model of what may be achieved through targeted international assistance.11.Viet Nam has been a major beneficiary of international assistance. In the period 20012006, Viet Nam received an estimated US 162 million in SPS-related technical assistance. Italso benefited from some of the US 200 million in assistance involving SPS issues at regionallevel among ASEAN members.2EU’s Rapid Alert System for Food and Feed weekly reports 2007.5
12.Most of the direct assistance received by Viet Nam has been targeted at food safety(approximately US 111 million), which includes two projects in the fisheries sector offered byDANIDA accounting for US 85 million. More recently, efforts to control HPAI have dominatedmuch of the donor focus on SPS issues, particularly in the animal health area. Continuedinternational concern at the risk to human health posed by HPAI means that donor assistance onthis issue should continue to grow in future years as pledges becomes disbursements. WTOaccession and participation in regional trading arrangements have also been powerful factorsmobilizing national and donor efforts towards SPS compliance.13.Continued donor assistance in the SPS area means that many of the SPS needs identifiedin prior SPS capacity evaluation studies are being addressed. The following projects with SPScomponents are either on-going or in the pipeline: Asian Development Bank Quality and SafetyImprovement of Agricultural Products, DANIDA Fisheries Support programme, post-WTOaccession multi donor trust fund, European Technical Assistance Programme for Viet Nam, ECMultilaterial Trade Assistance Project (MUTRAP II), JICA assistance on plant quarantine andheat treatment, NZAID support on plant quarantine, NZAID/FAO support for food safety,NZAID PCPB project, OIE SEAFMD, UNIDO Establishment of SMTQ infrastructure, UN JointProgramme for Trade Development in Viet Nam (including related FAO activities), Joint UNViet Nam Avian and Human Pandemic Influenza Programme and other HPAI relatedprogrammes, Swiss and US training assistance on pest risk analysis, pest databases and the WorldBank Livestock Competitiveness and Food Safety Project. Some of these projects are in aplanning phase and have scope for providing contributions to SPS capacity building.14.From this overview, it is clear that Viet Nam can expect a continuation of internationalassistance. However, many needs remain or have been insufficiently addressed. Perhaps thebiggest challenge facing national SPS decision-makers and donors relates more to providingclarity on outstanding areas of needs, the targeting of planned assistance and ensuring thatduplication of effort is avoided so that donor programmes complement past, present and plannedactivities.4.Overview of outstanding SPS needs15.In 2005, the World Bank, in consultation with relevant Vietnamese Governmentagencies, prepared an action-oriented SPS plan with identified priorities. The gaps identified bythe current report reiterate the needs expressed in this Action Plan: (i) clarity in the institutionalframework; (ii) strengthening of the surveillance system (including the monitoring of agriculturalinputs) and (iii), development of the capacity for risk analysis.16.After a year of WTO membership, Viet Nam’s SPS management system is going throughadjustments as a result of the reorganization of various ministries. The Ministries of Industry andTrade have merged into the new Ministry of Industry and Trade; the Ministry of Fisheries hasbeen integrated into the Ministry of Agriculture and Rural Development (MARD). As part of thisintegration, the former National Fisheries Quality Assurance and Veterinary Directorate(NAFIQAVED) has been transformed into the National Agriculture, Forestry and FisheriesQuality Assurance Department (NAFIQAD) with a wider mandate for safety and qualitymanagement of fisheries and other agricultural products. Consequently, there is a need to updatelaws and regulatory frameworks, to define roles and responsibilities of agencies, and at the sametime to solve a lack of clarity with regard to the delineation of functions and responsibilities and anumber of overlapping mandates.6
17.In the areas of monitoring, surveillance and reporting of plant and animal health and foodsafety hazards, problems remain, particularly in relation to meeting the requirements of tradingpartners. Risk-based surveillance and inspection is still in its infancy and there is much to dobefore risk-based monitoring and inspection systems are fully implemented. One particular casein point is Viet Nam’s SPS border controls which are based on 100 per cent inspection ofshipments. The Greater Mekong Subregion Agreement on cross-border trade, which aims atpromoting intra-regional trade through reduced border controls, among others by compliance withSPS risk-based principles, cannot yet be implemented.18.Although Viet Nam is increasingly able to manage risks in its large-scale exportindustries, serious problems remain for managing food safety, animal and plant health indomestic markets. Not only do the main costs of human and agricultural health estimated by theWorld Bank Action Plan originate in the domestic sector, there is also a continuous risk of spillover of hazards to the export sector.19.Viet Nam has been at the fore front of the fight against HPAI. Significant improvementshave been achieved in disease surveillance, reporting and outbreak management for HPAI. Inaddition to the on-going challenge of managing HPAI, a major task remains in controlling otheranimal diseases, such as CSF and FMD, particularly in relation to trade with Viet Nam'sneighbours. Ensuring that HPAI assistance also plays a part in the control of other livestockdiseases is essential.20.Another key challenge in the area of SPS-related technical assistance is to ensure thatnational donor coordination mechanisms function appropriately to ensure maximum impact andthat all stakeholders learn lessons from each other on good practice in this area.21.At a disaggregated level, many possibilities for further SPS assistance exist. At a moreaggregate level there are major gaps in SPS capacity of a strategic nature. These outstandingpriority areas which could be addressed through forthcoming projects include: Strengthening the institutional and legislative frameworks for food safety and animal andplant health that will include clear definition of responsibilities and necessary provisionsfor enforcement; Promoting greater awareness of SPS issues for public health, agricultural health and tradeperformance:¾ Among policymakers in the central government to support the SPS system, bothfinancially and through an appropriate risk-based regulatory framework;¾ Among implementing offices at provincial and district levels to more effectivelyimplement and enforce safety measures; and¾ Among food producers and processors, food handlers and consumers throughknowledge and application of hygienic and safe practices. Intensifying information and educational programmes on good practices in foodproduction, processing and preparation for farmers, processors and consumers and relatedenforcement actions by regulatory authorities;Designing and implementing more effective risk-based monitoring and control systemsfor agro-chemicals, surveillance and reporting of pest and diseases; andEnhancing overall SPS capacity for diagnosis and enforcement. Capacity includesinspection and certification, surveillance and monitoring and risk analysis. Assistance 7
should address needs related to facilities, equipment and human resources based on anevaluation to identify priority needs.8
SPS Balance sheet: Vietnam3Overview of SPS priority action areasPriorities Strengthen the institutional and legislative frameworks for food safety, animal health and plant health with necessary provisions for enforcement.1 Promote greater awareness of food safety issues for both trade and public health, especially for provincial government officials.1 Intensify information and education programmes on good practices in food production, processing and preparation for farmers, processors and consumers.1 Develop more capacity for data collection on pests, diseases and food hazards (through surveillance) and risk assessments needed to better manage risks of foodsafety, plant and animal health.1 Provide training on IPM/GAP for agricultural products, in particular, fruit and vegetables, and quality management (such as HACCP) for food processingestablishments.2 Design and implement more effective monitoring and control systems for agro-chemicals.2 Enhance capacity for diagnosis and enforcement.Status3NeedsAssistanceGapsSpecific market access constraintsAusAID SPSCBP, AADCPPlant pests and diseases (coconut beetle, fruit fly).Strengthen biosecurity controls onthe basis of risk-based approachEndemic diseases such as FMD, CSF, ND and HPAI.JICA assistance with facilityfor vapour heat treatmentVarious HPAI projectsLack of an effective control system for veterinary medicinalproducts (EU FVO report).OIE SEAFMDEU MUTRAP II on mutualrecognition agreementsEU training onresidues/contaminants inhoney and honey products3See notes for clarification at the end of the table.9In general, improved plantand animal healthmanagement andmonitoring of agriculturalinputs as expressed invarious gaps belowPriorities
SPS Balance sheet: VietnamStatusNeedsAssistanceGapsPrioritiesGreater clarity ondelineation of functionsand responsibilities; to bedefined in a major updateof the law and regulatoryframework1Institutional structures, clarity and capacitySPS institutionsMinistry of Agriculture and Rural Development (MARD) –state management of agriculture, forestry, fisheries, irrigationand rural development.Plant Protection Department (PPD) – plant health, NPPO.Department of Animal Health (DAH) – animal health (bothterrestrial and aquatic animals).National Agro-Forestry and Fisheries Quality AssuranceDepartment (NAFIQAD) – control of quality and safety ofagricultural, forestry, fishery and salt products (includingexports, imports for further processing and/or domesticallyproduced products before leaving
APO Asian Productivity Organization . ISPM International Standards for Phytosanitary Measures . (collectively known as sanitary and phytosanitary or SPS) requirements. As such, this research is being carried out in the framework of the broader Aid for Trade initiative. The work builds on
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