(DTIS) Update, Volume 1 – Main report - Enhanced Integrated ...

A substantial chunk of the measures imposed by Burundi are SPS (Figure 4.6). The balancecorresponds to technical regulations for reasons other than SPS (so-called “TBT”) and pre-shipmentinspection (PSI), which is imposed on all imports above a de minimis threshold. PSI has been repeatedlyflagged by the private sector as an issue, which we discuss in the next section.NTM frequency ratios are pretty much the same, and very high, across agro-food productcategories (Figure 4.7). Such high frequency ratios, again, raise questions for a country where most ofthe population consumes its own production and where small-scale cross-border trade in agriculturalproducts can be an important source of income, in particular for women, and is not very amenable to thetype of traceability and quality controls that full application of the country’s arsenal of SPS legislationwould imply.Figure 4.6: Overall frequency ratios,by type of measureFigure 4.7 Frequency ratios,foodstuffs100806040201008060402000A: SPSB: TBTC: InspectionD: Price controlE: QRsLive AnimalsPrepared FoodVegetables productsFats & OilSource: Cadot and Gourdon (2011), based on WorldBank/UNCTAD data.Source: Cadot and Gourdon (2011), based on WorldBank/UNCTAD data.In sum, a preliminary look at Burundi’s inventory of NTMs, in international comparison, suggeststhat once controlled for Burundi’s level of income and administrative capabilities, there is adefinitive risk of regulatory overkill. It is not clear that the heavy regulatory apparatus being put inplace addresses a well-identified societal demand. Fragmentary evidence gathered in the course of themission suggests that the kind of consumer concerns that justify heavy regulation in the E.U. may not becentral issues for the functioning of markets in Burundi. Instead, market transactions seem to be affectedin Burundi by double moral hazard: sellers are worried of buyers not paying them, while buyers areworried of sellers cheating on product characteristics or quantities. Such lack of trust in markettransaction is not overly surprising for a country that is just emerging of a protracted civil war. The Statehas a role to play to encourage the buildup of confidence (“social capital”) through a transparent and fairregulatory environment. However it is not clear if regulations that go so much beyond currentcapabilities that they carry little credibility will really help, because the same lack of trust currentlycharacterizes relations between the private sector and the State.78 / 153