Regional: CAM/LAO: Trade Facilitation: Improved Sanitary and Phytosanitary (SPS) Handling in Greater Mekong Subregion Trade Project

Sovereign Project | 43120-013 Status: Approved

Summary

ADB is helping Cambodia and the Lao People’s Democratic Republic strengthen sanitary and phytosanitary systems (SPS) to facilitate trade and protect public health. The project will establish and enhance surveillance and inspection programs for plant health, animal health, and food safety. It will improve training of specialists, and promote regional cooperation and harmonization of SPS measures.

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Project Name CAM/LAO: Trade Facilitation: Improved Sanitary and Phytosanitary (SPS) Handling in Greater Mekong Subregion Trade Project
Project Number 43120-013
Country Regional
Project Status Approved
Project Type / Modality of Assistance Grant
Loan
Technical Assistance
Source of Funding / Amount
Grant 0296-REG: LAO: Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project
Asian Development Fund US$ 11.00 million
Loan 2873-REG: CAM: Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project
Asian Development Fund US$ 11.00 million
Loan 2874-REG: LAO: Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project
Asian Development Fund US$ 3.00 million
TA 8096-REG: Improving Sanitary and Phytosanitary (SPS) Handling in Greater Mekong Subregion Trade
Technical Assistance Special Fund US$ 750,000.00
Strategic Agendas Inclusive economic growth
Regional integration
Drivers of Change Governance and capacity development
Sector / Subsector

Agriculture, natural resources and rural development - Agricultural production - Agro-industry, marketing, and trade - Livestock

Education - Tertiary

Industry and trade - Trade and services

Gender Equity and Mainstreaming Some gender elements
Description The project will strengthen institutions and operational and management capacities in Cambodia and the Lao PDR for operating cost-effective SPS systems that facilitate trade and protect health.2 The project will focus on GMS trade in agriculture, food, and forestry (AFF) products for which SPS measures for plant health, animal health, and food safety apply. The project will establish, strengthen, and implement (i) surveillance and inspection programs for plant health, animal health, and food safety; (ii) enhanced education levels and university training of SPS specialists; and (iii) regional cooperation and harmonization for SPS measures and practices. It will selectively strengthen food safety capacities of private food handling enterprises and restaurants in tourist areas. The project will be implemented by the national authorities in each country.
Project Rationale and Linkage to Country/Regional Strategy

The GMS regional cooperation strategy and program focuses on connectivity and competitiveness. While recent investments in physical infrastructure have created new opportunities for trade, GMS governments increasingly realize that weak legal, institutional, and administrative capacities hinder the optimal use of infrastructure and are insufficient to address trade-related health hazards. A number of initiatives have been launched to overcome such constraints, including the GMS cross-border transport agreement. The midterm review of the 10-year (2002 2012) GMS strategic framework reaffirmed the importance of trade and transport facilitation initiatives, including strengthened SPS capacity and cooperation. The essential SPS issues that need to be resolved to meet the development needs of the GMS were identified and a GMS action plan for SPS arrangements, 2010-2015 was formulated.

Trade in AFF products among GMS countries amounted to $9.27 billion in 2009. This constituted about 13% of intra-GMS trade. Total GMS AFF exports grew more than fourfold from 2000 to 2009. Nevertheless, because of poor SPS management capacities, market access for a wide range of AFF products from Cambodia and the Lao PDR remains limited, both in the GMS and globally. The governments of Cambodia and the Lao PDR have not been able to protect their crops, livestock, and consumers against trade-related health hazards caused by plant pests, animal diseases, and food safety hazards. It is expected that, with better SPS systems in place, trade of AFF products from Cambodia and the Lao PDR will increase by about 10%-15% annually. Better SPS systems will also lead to reduced risk of crop, animal products losses, and reduced incidence of food-borne diseases. Effective national SPS management systems are building blocks for regional harmonization and for establishing trust among GMS countries in each other's SPS measures.

There is lack of human resource capacity to (i) undertake surveys on crop pests and diseases, (ii) manage inspections and interceptions of imported products, (iii) monitor the agricultural pesticide trade, (iv) understand the risks of forest pest spread associated with trade in wood and forest products, and (v) sustain and expand the regional trade in crop products. There is also a need to (i) contain transboundary animal diseases, (ii) improve surveillance of veterinary drugs and feed, (iii) maintain animal food product safety, and (iv) improve border clearance procedures. Information on food safety is scarce, characterized by inadequate monitoring of food, food establishments and food poisoning outbreaks. Although tourism in Cambodia and the Lao PDR is rapidly growing, it is vulnerable without adequate food safety supervision.

Compliance with global SPS requirements requires national specialists to undertake tasks related to surveillance, risk analysis, testing, diagnostics, pest identification, standards, and conformity assessment. Trading partners and private companies often require application of good agricultural practices, good manufacturing practices, and quality assurance management (such as hazard analysis critical control points). Cambodia and the Lao PDR lack specialists who can perform these tasks. These specialists need to come (in part at least) from graduates of national higher education systems that train SPS specialists. Strengthening capacities of SPS agencies is urgently needed to meet the increasing requirements for exports and trade facilitation, and to protect health.

The project is in line with the GMS 10-year strategic framework, 2012'-2022 and supports the thrust to facilitate cross-border trade and investment. The project will contribute to pillar 4 (cooperation in regional public goods) of ADB's Regional Cooperation and Integration Strategy. The project is aligned with the targets of the National Strategic Development Plan Update, 2009-2013 of Cambodia and the National Socio Economic Development Plan VII, 2011-2015 of the Lao PDR. Improving SPS management is explicitly reflected in various Cambodia and Lao PDR sector strategies and plans, and in the GMS core agriculture support program.

Trade facilitation remains a challenging agenda in the GMS. Previous experience shows the need to adopt a phased approach to formulate well-targeted and sequenced projects to ensure implementation of bilateral and regional commitments on cooperation and harmonization. Inadequate capacities at the country level are major constraints for effective regional cooperation in SPS arrangements. Development partners, such as the United Nations agencies, the World Bank and bilateral agencies support various aspects of SPS capacity building in the GMS, but ongoing projects have not addressed SPS issues in a comprehensive manner. Preparatory work has been firmly anchored in the lessons of international experiences that stress the need for prevention rather than end-of-pipe controls, which have proven to be costly and frequently ineffective. Involvement of the private sector and civil society in SPS capacity building is necessary to ensure the right technical issues and challenges are addressed and for longer-term sustainability. During the project preparation phase, workshops to consult the private sector on SPS issues were held in Cambodia and the Lao PDR, which contributed to the overall project design. Likewise, coordination with the GMS working group on agriculture has been maintained.

Impact

Project Outcome

Description of Outcome Enhanced SPS management system and provision of SPS services.
Progress Toward Outcome

--LAO-At midterm, this project has not only shown excellent progress but more importantly has demonstrated tangible benefits to the Laotian people. MAF has been able to negotiate market access arrangements with PRC for five key export products (MOUs on phytosanitary import condition for rice, corn, watermelon, cassava and banana). Most significant milestone is the MOU for rice in 2015, LAO PDR's most important crop, it has the right to substantially increase its exports to PRC. Market access protocols have also been signed with Thailand for exports. With its improved capacity to develop pest lists and manage surveillance, LAO PDR is now more able to negotiate with its trading partners since pest information is more reliable. For the animal health component, the surveillance plan for TAD has been approved. The component has also managed the FMD outbreaks in 2 provinces in 2015 through the use of variety of control measures.On food safety, the surveillance plan that is being implemented will provide authorities the much needed information on the safety status of food for consumption which will contribute to food safety policy making and implementation process.

--CAM-At mid-term, under the plant component, substantial progress have been made with pest list surveys and development. Pest surveys for rice and maize have been completed and were for final approval. The pest lists are an essential tool in making and securing market access for such crops. Under the SPS education component, excellent progress has been made with the development and approval of the upgraded SPS curricula at the Royal university of Agriculture (RUA). Under the food safety component, solid plans for market surveillance and surveillance of street food and restaurants are now in place. For the animal component, good progress has been made in responding to outbreaks and biosecurity risk mitigation.

Implementation Progress
Description of Project Outputs

Strengthened surveillance and inspection programs

Improved regional cooperation and harmonization

Enhanced education levels and university training of SPS specialists

Effective project management

Status of Implementation Progress (Outputs, Activities, and Issues)

L2874/G0296-LAO was delegated to LRM effective 8 December 2015.

LAO--Nine pest lists developed. Annual surveys undertaken for corn, watermelon, dry cassava, banana, rice, and sachi inchi under MOUs now agreed with PRC. Formal rice exports to PRC now underway for the first time as is formal trade in watermelon and corn.

LAO--The surveillance plan has now been developed and equipment and consumables procured. The plan is about to be rolled out with active surveillance and related awareness activities in two target provinces commencing.

LAO--A draft risk categorization framework and guideline for surveillance has been developed with approval targeted before the end of 2015. In the interim, the mobile laboratory has already collected 600 samples in Vientiane and a bi-annual surveillance plan has been approved for the latter half of 2015.

LAO--Revised curricula for plant health, animal health and food safety now with the Ministry of Education for final approval with the higher technical department having approved the plant health and food safety ones already.

LAO--A number of bilateral working group meetings on Plant Health, Animal Health and Food Safety have been held to exchange information and to strengthen cooperation on surveillance activities.

LAO--Project staffed and became operational from 2013 with financial, operational and monitoring and evaluation systems in place.

CAM--Updated pest lists for rice and maize have been produced. Pest surveys have commenced for mango, cassava and citrus fruit and all are targeted for completion by the first quarter of 2016. Further survey work is planned for bananas, pepper, soybean, and cashew nuts in 2016 and to all be completed by 2017. Manuals have been developed for the risk based inspection of plant related products and training is now underway.

CAM--The Animal Health component implementation unit responded to three TAD outbreaks in 2014 and two 2015. A TAD surveillance plan has been designed and training provided. The component however needs to catch up the pending work related to surveillance during the remaining project duration.

CAM--Food safety market surveillance and food establishments surveillance programs were about to be implemented starting December 2015.

CAM--The four upgraded SPS curricula have been completed.

CAM--Some bilateral and regional meetings on plant health, animal health and food safety have been conducted.

CAM--Project staffed and and became operational from 2012 with financial, operational and monitoring and evaluation systems in place.

Geographical Location

Safeguard Categories

Environment C
Involuntary Resettlement C
Indigenous Peoples C

Summary of Environmental and Social Aspects

Environmental Aspects na
Involuntary Resettlement na
Indigenous Peoples na
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation

Business Opportunities

Consulting Services Advance action for Procurement and Technical packages.
Procurement Advance action for Procurement and Technical packages.

Responsible Staff

Responsible ADB Officer Lingling Ding
Responsible ADB Department Southeast Asia Department
Responsible ADB Division Public Management, Financial Sector and Trade Division, SERD
Executing Agencies
Ministry of Agriculture, Forestry & Fisheries
# 40 Norodom Blvd.
Phnom Penh
Cambodia

Timetable

Concept Clearance 23 Nov 2010
Fact Finding 22 Aug 2011 to 14 Sep 2011
MRM 24 Nov 2011
Approval 26 Jun 2012
Last Review Mission -
Last PDS Update 23 Mar 2016

Grant 0296-REG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Jun 2012 01 Aug 2012 19 Sep 2012 28 Feb 2018 - -
Financing Plan Grant Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 11.46 Cumulative Contract Awards
ADB 11.00 26 Jun 2012 7.31 0.00 66%
Counterpart 0.46 Cumulative Disbursements
Cofinancing 0.00 26 Jun 2012 5.26 0.00 48%

Loan 2873-REG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Jun 2012 16 Aug 2012 08 Oct 2012 28 Feb 2018 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 11.41 Cumulative Contract Awards
ADB 11.00 26 Jun 2012 5.48 0.00 54%
Counterpart 0.41 Cumulative Disbursements
Cofinancing 0.00 26 Jun 2012 5.76 0.00 56%

Loan 2874-REG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Jun 2012 01 Aug 2012 19 Sep 2012 28 Feb 2018 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 3.00 Cumulative Contract Awards
ADB 3.00 26 Jun 2012 1.95 0.00 71%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 26 Jun 2012 2.27 0.00 82%

TA 8096-REG

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
26 Jun 2012 - 26 Jun 2012 31 Aug 2017 - -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
750,000.00 0.00 0.00 0.00 0.00 0.00 750,000.00 26 Jun 2012 480,936.44
Title Document Type Document Date
Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project - Cambodia Procurement Plans Oct 2013
Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project - Lao People's Democratic Republic: Procurement Plan Procurement Plans Oct 2013
Trade Facilitation: Improved Sanitary and Phytosanitary (SPS) Handling in Greater Mekong Subregion Trade Project: Project Data Sheet (Khmer Translation) Translated PDS Jan 2013
Trade Facilitation: Improved Sanitary and Phytosanitary (SPS) Handling in Greater Mekong Subregion Trade Project: Project Data Sheet (Lao Translation) Translated PDS Oct 2012
Loan Agreement (Special Operations) for Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project Loan Agreement (Special Operations) Aug 2012
Financing Agreement for Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project Financing Agreement Aug 2012
Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project - Lao People's Democratic Republic Project/Program Administration Manual Jun 2012
Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project Reports and Recommendations of the President Jun 2012
Trade Facilitation: Improved Sanitary and Phytosanitary Handling in Greater Mekong Subregion Trade Project - Cambodia Project/Program Administration Manual Jun 2012

Safeguard Documents See also: Safeguards

Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.

None currently available.

Evaluation Documents See also: Independent Evaluation

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Related Publications

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