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Estimating the Quantity of Non-Tariff Measures SADC Meat and Milk Trade

Mmatlou Kalaba and Johann Kirsten

No 206513, Working Papers from University of Pretoria, Department of Agricultural Economics, Extension and Rural Development

Abstract: Global trade protection in the form of tariffs has been on the downward trend since the conclusion of the World Trade Organisation Uruguay Round of negotiations. The same pattern was observed in SADC as well as other regional integration groups. In SADC the declining trade protection was not accompanied by improvement in trade performance. If anything, the share of intra-SADC trade has actually declined during the phase down of tariffs in the eight year period. This study explores the possible reason for poor trade performance in the tariff reducing environment using meat and dairy markets as case studies over the period 2000 to 2010. It is hypothesised that non tariff measures (NTMs) are more trade restricting that tariffs. The statistics show that on average each agricultural product traded is affected by about ten NTM. These vary from country to country, with Mozambique having the highest incidence of NTMs, and the lowest being Malawi. On a product level, fruits are the most affected products with more about 40% of all NTMs applied. The gravity model was used to estimate intra-SADC trade and to evaluate the quantity impacts of NTMs on tariffs. The NTMs applied to meat products were found to be as high as 400% compared to roughly 200% for dairy. Furthermore, it was found that in the case of dairy tariffs and NTMs were used jointly as means of protection. This implies that there is a need to focus attention, both in research and policy on the NTMs.

Keywords: International Development; International Relations/Trade (search for similar items in EconPapers)
Pages: 28
Date: 2012
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DOI: 10.22004/ag.econ.206513

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