The financial burden of African Horse Sickness: a case of the European Union trade ban on South Africa’s horse industry

Abstract

ABSTRACT Globalisation and the increased movement of goods such as live animals and animal products across national borders can exacerbate the introduction and spread of diseases. This risk can be mitigated through adherence to trade control measures such as the Sanitary and Phytosanitary Measures (SPS) of the World Trade Organization (WTO). However, compliance with SPS measures usually results in additional production and trade costs. This paper applied cost–benefit analysis, using stochastic scenario analysis, to estimate the financial burden of SPS measures on exporting horses from South Africa to the European Union (EU). These measures were instituted following a ban on the direct export of horses from South Africa to the EU, triggered by outbreaks of African Horse Sickness (AHS) in the AHS Controlled Area in the Western Cape Province. Analysis revealed that compliance to existing SPS measures by exporting a horse via a third country is 1.67 times more costly than exporting directly to the EU. A strengthened public-private sector partnership is recommended to jointly identify the most efficient and effective ways to develop capacity for collaborative judicious investment in order to build a resilient horse industry thereby enabling employment creation and economic growth.