On May 11 this newspaper published an editorial on the new Food Safety Modernization Act, signed into law by US President Barack Obama in the hope that both the Government of Guyana and the private sector would be reminded of the need to take action to address what is in fact the most sweeping reform of US food safety laws in more than half a century and, more importantly from our vantage point, probably the most formidable threat ever to access to the US market for local exporters.
During the period between then and now there has been no public pronouncement or no known initiative on the issue. We do so again since, first, most local manufacturers of foods targeting US markets are, in all likelihood, not equipped at this time to meet the requirements of the FSMA and are therefore in imminent danger of being denied access to that market since the new FSMA regulations are scheduled to come into effect this year.
Under the new law foreign facilities – including those in Guyana – producing, manufacturing, holding, packing or distributing foods that will eventually be exported to the United States will be required to comply with new registration requirements and to allow the US Food and Drug Administration (FDA) access to their operating records and to allow the FDA for what is described as “hazard analysis.” In other words exporting firms will be required to allow the US FDA access to their operations here in Guyana so that the FDA can satisfy itself that their operating procedures are consistent with the standards set under the new legislation.
We have learnt of a single private sector case in which one of the country’s bigger exporters to the US has been paying attention to ways in which it will be required to shape or reshape its operations to ensure compliance with those regulations. That individual instance apart we are aware of no other initiative by either the government or the private sector to respond to the promulgation of the FSMA.
Probably the biggest challenge that will face local agro producers currently enjoying or aspiring to US markets is the requirement of “traceability.” The FSMA regulations will require those manufacturers to account not only for the bona fides of their own manufacturing operations but also from the farms that produce their raw materials. What this means in effect is that factories and farms will have to enter into arrangements that allow the former to verify the health and food safety considerations associated with the cultivation of fruits and vegetables used in the manufacturing process. That, in the Guyana context, is likely to provide formidable challenges since agro-processing in many instances – pepper sauce is perhaps one of the better examples – proceeds on the basis of the use of peppers acquired from various small farming operations. Ideally, manufacturers will now have to localize the source of their raw materials, confining acquisition to a single source.
Responding to the FSMA is important if only because, when implemented, it could present a formidable non-tariff barrier to access to the country’s biggest market for exporters to foods produced in Guyana. If this is to be averted smaller operators currently producing foods with the US market in mind will, probably in almost every case, have to invest considerable sums – probably millions of dollars according to a local source – to bring their operations – whether these be the cultivation of agricultural exports or factories designed for agro-processing – up to a standard that satisfies the requirements of the FDA. The prognosis is that local small and medium-sized businesses either currently enjoying or aspiring to US markets will not be able to make those adjustments without considerable financial and technical support in which circumstance they can kiss the US export market goodbye since the FSMA empowers the US FDA to order a mandatory recall once it determines that there exists a reasonable probability that a product poses a health hazard. Prior to the promulgation its powers were limited to recommending voluntary recall of those products.
There has – as far as we are aware – been no serious initiative to sensitize exporters and potential exporters to the FSMA and its implications despite the fact that the advent of the new US legislation coincides with what we are told is a push to significantly increase the volumes of agro-processed food products exported to the United States. Here, the talk has been about improving sanitary and phyto-sanitary standards in the production process, acquiring more modern and efficient processing equipment and improving packaging and labelling standards to match those of competitors from other countries. What we may well find, however, is that having done all this we would not have done nearly enough to satisfy the new FSMA regulations.
Even in the absence of the FSMA some small-scale local exporters have been talking to this newspaper about the difficulties which they face in securing sustained access to markets in North America. Those problems include difficulties associated with securing reliable arrangements with distributors in the US and Canada and the age old problem of adequate and reliable cargo services. In fact, we are told by a GMSA official not only that the local manufacturing sector, on the whole, is not equipped for structured and sustained export of foods to North America but also that outside very few local exporters, the export of food to the North America market is sporadic and that, for one reason or another, some of these arrangements fall through after a short while.
Elsewhere in the Caribbean there is evidence of a much greater sense of diligence in the response to the promulgation of the FSMA. In Jamaica, for example, Grace Kennedy, probably the most successful regional firm as far as access to US markets is concerned has already expressed confidence that its operations will meet the allowable standards for entry of its products into the US under the regulations set out in the FSMA.
That apart, Jamaica, evidently recognizing that it has a great deal to lose from loss of US markets, has been particularly proactive in its response to the FSMA. In September last year the Ministry of Agriculture in Kingston declared that up to 80 per cent of local food exporters would fail to meet the standards required under the FSMA, a level of candidness rarely if ever demonstrated here in Guyana. More than that Guyana’s sister Caricom country has moved to secure a J$100 million loan facility from its EX-IM bank to assist producers in assessing the requirements of FSMA certification including the acquisition of equipment and tools necessary to assist certification, an example which the Government of Guyana ought to follow probably with the support of a multilateral funding agency. More than that Jamaica’s Bureau of Standards and its Ministry of Industry are sharing the cost of providing further assistance including inspection and training to local private sector entities to ready them for the FSMA challenge.
Compared with Guyana where neither the government nor the private sector has made any pronouncement of significance on the FSMA, Jamaica’s response reflects a mindfulness of how its 200-odd food exporters are likely to be affected by the FSMA and here again, given all of the lip service that we have been paying to the importance of securing markets for our value-added products, much of which, incidentally, is food, both the government and the private sector umbrella bodies need to bestir themselves on the issue of providing a response to the FSMA before at least some of the regulations are visited upon us in a matter or months.
