2294 part 1 final report.pdf - Agra CEAS Consulting

Prevention and control of animal diseases worldwide
Part I: Economic analysis: prevention versus outbreak costs
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Our analysis in this section leads us to the following conclusions:
Case study: Romania
Romania’s VS have undergone significant restructuring and upgrading in the run up to EU
accession (Romania became an EU member on 1 January 2007). Having suffered a large
number of outbreaks since 2004, this country was relatively recently declared HPAI-free.
Our analysis and comparisons of data on the planned commitments for 2006-09 under the
WB integrated plan for the control and eradication of avian influenza, against real and
projected costs of the outbreaks, reveal the relative scale of the costs and benefits involved,
and the interest in investing further in improved structures and surveillance systems (see
Notes*). For example:
• The total commitment on animal health under the 2006-09 WB plan (excluding control
costs in the event of an outbreak) comes to some US$ 12.6 million for the 3 year period
(or an average US$ 4.2 million per year), while the direct costs from the outbreak in the
six months of 2005-06 outbreak alone were estimated at US$ 67.6 million, excluding
consequential on-farm losses (Figure 15).
• Investing in strengthening disease surveillance and diagnostics would cost a total US$ 11
million over the same period, or US$ 3.6 million a year which is less than 0.5% of the
above conservative estimate.
• The relative scale of this investment is even more evident when adding some ripple and
spill-over effects, bringing the total impact at some US$ 211.6 million, as a consequence
of the effects of the October 2005 to May 2006 outbreak.
* Notes: These benefits assume that a certain investment will result in productivity gains and exports. The scale of
the benefit is conditional on the effective design and implementation of the investment to be undertaken, leading to
an effective control of the disease (eradication is questionable as there is a significant risk factor that the disease
would re-appear, as has been the general experience. The above calculations do not take into account the
incremental operational costs involved, which can be a significant part of the cost of strengthening VS. On the other
hand, the investment in strengthening the control of a particular disease, e.g. HPAI, can have important spill-over
benefits on the entire VS.
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