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Turkey’s biosafety law causing significant economic harm to agri-food chain

Published on: 2nd May 2012
Published By PG Economics

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May 2nd 2012: A new Economic Impact Assessment of Turkey’s Biosafety Law finds that the way in which this Law is being implemented has resulted in substantial negative economic impacts for the important Turkish importing, feed and food manufacturing and livestock production sectors.

“There is clear evidence of major economic damage and market disruption having been caused by the way in which Turkey’s Biosafety Law is being implemented” said Graham Brookes, lead author of the report. “This situation can be expected to get progressively worse, threatening the viability of many Turkish businesses (notably small-and medium-sized enterprises) and risking the export of jobs and investment from the country, unless a timely and science-based Turkish GMO approval system is operated”

Previewing the study, the key findings are:

  • The implementation of the Law has caused considerable trade and market disruption, which to date amounts to over $0.8 billion. This is roughly equal to between 33% and 50% of the total annual net profitability of the Turkish food and drink sector;
  • The on-going annual cost (assuming no change to current policy) can reasonably be expected to be between $0.7 billion and $1 billion (and could be higher);
  • With an expected widening discrepancy between the timing and nature of new GM event approvals in Turkey compared to major cereal and oilseed raw material supplying countries, and the rapidly-increasing ‘pipeline’ of new traits and combinations of existing/new ‘stacked’ traits being approved for use in global agriculture, the negative impact is likely to get progressively worse;
  • The implementation of the Law has significantly increased legal and business uncertainty, reducing business confidence and adding further to negative economic impact and outlook;
  • The reduced levels of profitability, increased uncertainty and market disruption may result in re-location of processing facilities outside Turkey, leading to lower levels of income and employment generation, as Turkish jobs and investment are exported;
  • Those at greatest risk are small and medium-sized businesses that dominate the Turkish food sector;
  • There has been trade diversion away from traditional raw material suppliers (GMO producing countries). This raises the potential of a World Trade Organisation (WTO) complaint/challenge being launched against Turkey that could currently be worth over $1.1 billion.

If these significant negative economic impacts are to be avoided, the Turkish GMO regulations need to be implemented through timely application of a science-based approval system.

For additional information, contact Graham Brookes Tel +44(0) 1531 650123. www.pgeconomics.co.uk

PG Economics: 2nd May 2012 10:30:00

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