Launch of New WTO Publication on Illicit Trade in Food and Food Fraud

Opening Remarks

• Event: Live-streamed, questions via dialogues@w.org
• Rules: Only one microphone open to ensure clarity on WTO YouTube
• Importance: Dedicated to illicit trade in food and food fraud
• Context: High importance for consumers, producers, regulators
• Previous Events: 2022 Trade Dialogue, 2023 Agriculture Symposium

Speakers

1. Dr. Ngozi Okonjo-Iweala (Director-General, WTO)
2. Helen Medina (CEO, World Spirits Alliance)
3. Jeff Hardy (Director-General, TRACE)
4. Ambassador Li (Permanent Representative of China to WTO)
5. Ambassador Dwarka-Canabady (Permanent Representative of Mauritius to WTO)
6. Jean-Marie Paugam (WTO Deputy Director-General)

Key Points from Dr. Ngozi Okonjo-Iweala

• Illegal Trade Context: Both legal and illegal trade occurs; illegal trade undermines fair competition and consumer safety
• Statistics: Illicit trade worth $535 billion in 2019; tariff revenue losses $87 billion
• Previous Study: Illicit trade in medical products posed serious health threats, worth $28 billion in 2019
• Global Cooperation: UN and various organizations involved; UNODC partnership
• Food Fraud Definition: No global definition; Codex Alimentarius Commission working on it
• Publication Insights: Estimates, regulatory approaches, WTO agreement relevance
• Impact: Economic loss $30-50 billion annually, affects all continents and food sectors
• WTO's Role: SPS and TBT agreements key in regulating and addressing deceptive practices

Jeff Hardy on Illicit Trade

• Scope: Huge impact across multiple sectors—agriculture, pharmaceuticals, etc.
• Forms of Illicit Trade: Adulteration, substitution, mislabeling, falsifying origin, counterfeiting, smuggling
• Main Drivers: Need for food, population growth, increased food prices, elongated supply chains
• SDGs Impact: Illicit trade negatively impacts 11 out of 17 SDGs
• Call for Action: Need for balance between trade facilitation and combating illicit trade

Helen Medina on Spirits Industry

• Categories: Smuggling, counterfeit, artisanal, tax leakage, surrogate
• Challenges: Illicit trade fosters corruption, denies government revenue, risks consumer health
• Example: Impact of alcohol tax hikes on illicit trade
• WTO's Role: TFA Committee, TBT Committee, Trade Policy Reviews can help address the issue

Ambassador Dwarka-Canabady on Mauritius

• Challenges for Small Countries: Need for robust food safety infrastructure
• Trade Policy Reviews: Highlight deficiencies, need for aid and technology support
• Health Minister Involvement: Important to engage health ministries in addressing food fraud

Ambassador Li on China

• Food Safety Measures: Identifying challenges, modernized governance, use of IT and social media platforms
• WTO's Role: Promoting legal trade, ensuring measures aren't protectionist, enhancing cooperation

Jean-Marie Paugam on WTO's Contribution

• WTO Mechanisms: Custom Valuation Agreement, Pre-shipment Inspection, SPS, and TBT agreements
• Incentives and Barriers: Lowering trade barriers can reduce criminal incentives
• Technical Assistance: WTO offers capacity building in border controls, intellectual property, and product standards

Questions and Discussion

• Collaboration with UN Organizations: Essential for tackling cross-cutting issues
• Role of Private Sector: Vital in addressing challenges from illegal trade
• Impact on African Countries: Need for institutional capacity and technology to detect fraud
• E-commerce: Increasingly significant in illicit trade, need for technological solutions

Closing

• Continued Discussion: Emphasis on ongoing collaborations and taking actionable steps using WTO tools