Standards as Trade Barriers: The Case of Shrimp Export of Bangladesh to EU

The gains of the least developed countries from lower tariffs on food products in the wake of the creation of
World Trade Organization (WTO) were much less than anticipated because of the stringent food safety standards
of EU and other countries. These standards have in effect become additional ‘barriers’ to trade for the food
exporters of the least developed world, such as Bangladesh. The principal food export item of Bangladesh to the
European Union (EU), shrimp, was adversely affected by the application of the tough sanitary and phytosanitary
(SPS) measures by EU. The economic and social costs of the rejection and detention of shrimp consignments
because of allegations of not meeting these standards were considerable in view of the fact that the industry was
dominated by relatively small farmers and enterprises. Since SPS measures are consistent with WTO laws, the
shrimp industry had little choice but to comply with the SPS and other standards of EU. It has coped with the
emerging hurdles or barriers to trade with some effort; but costs increased, competitive strength of the exporters
suffered and the quantity of shrimp export stagnated.