Poulets Foundation En

8/4/2019 Poulets Foundation En

1/20

Chicken Exports:Europe plucks Africa!

A campaign for the right to protect

agricultural markets

BELGIQUE

LUXEMBOURG


2/20

P A G E 2

Summary

Chicken trade, the saga of international trade

with disastrous consequences p 3

Panorama of world markets p 4

Situation in African countries p 5

Poultry farming in Africa p 5

Cameroon, the front line p 7

Senegal: chicken at 250 FCFA/kg p 8

Political context in African countries p 10

Poultry markets in France and in Europe p 13

Newcomers in international trade p 14

The European context:

Economic partnership agreements p 16

A campaign with many facets p 17

Chicken Exports:

Europe plucks Africa!A campaign for the right to protect

agricultural markets

launched jointly

In Belgium by

Gresea: Groupe de Recherche pour une Stratgie conomiquealternativewww.gresea.be

SOS Faim Action pour le Dveloppementwww.sosfaim.be

In France by

Agir Iciwww.agirici.org

CCFD: Comit catholique contre la Faim et pour le Dveloppementwww.ccfd.asso.fr

CFSI: Comit franais pour la Solidarit internationalewww.cfsi.asso.fr

GRET: Groupe de Recherche et dEchanges technologiqueswww.gret.org

In Luxembourg bySOS Faim Action pour le Dveloppementwww.sosfaim.org

with the support:

At the European level of:

APRODEV: Association of World Council of Churches relatedDevelopment Organisations in Europewww.aprodev.org

In Switzerland of:

IRED: Innovations et Rseaux pour le Dveloppement

www.ired.org

In Cameroon of:

ACDIC: Association citoyenne de Dfense des Intrts collectifswww.acdic.org

SAILD: Service dAppui aux Initiatives locales de Dveloppementwww.saild.org

In Benin of:

ANAB:Association nationale de lAviculture bninoise

In Ivory Coast of:

IPRAVI: Interprofession avicole ivoirienne

Authors of document: Caroline Dormus-Mege (Agir Ici),

Catherine Gaudard (CCFD), Denis Horman (Gresea), Bndicte Hermelin (GRET)

and Jean-Jacques Grodent (SOS Faim Belgique).


3/20

C

h

icken

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica

!

P A G E 3> Chicken trade,

a saga on international tradewith disastrous consequences

Since 1996, imports of deep frozen chicken are exploding in a great number of African countries.

The consequences of these developments are becoming clear today: thousands of jobs are threat-

ened, or even disappear, in Africa as in Europe; security of food supplies for African populations is

in jeopardy; poultry, unfit for human consumption, is sold on African markets; the environment suf-

fers from intensive breeding practices in the poultry business; working conditions in industrial

breeding centres are deteriorating in Europe as well as in countries of the South.

Furthermore, many agribusiness companies relocate their production sites, thus forcing many

breeders to close down in Europe and contributing to the rise of new exporting countries,like Brazil.Just as in a carefully planned scenario, these phenomena are linked.

The facts are known. Mobilization is on the way, first in Africa (Cameroon and Senegal a.o.), then in

Europe (France, Belgium, Luxembourg, Netherlands, Germany). Analyses are made, practices

denounced, alliances are formed and the goals made clear.

The European Union (EU) bears a triple responsibility: today, it is the greatest exporter of deep frozen

chicken; it plays a major role when it comes to define the rules of international trade; it defends a

Common Agricultural Policy (CAP) which privileges intensive farming as well as exports to already

fragile countries

The chicken saga covers problems of agriculture, environment, society and commerce.Thus it bears on the fate of farmers in the South as well as on that of farmers and workers in the

North,on the environment of Brittany as well as in northern Brazil; it affects food security and safety

of consumers and citizens,be they Africans or Europeans !

Are chicken exports just an isolated case,an example of concentration of possible failures within a

system of free trade with farm products?

Production and marketing of poultry certainly are emblematic,but cereals, tomatoes, onions or milk

are as many threats to fragile food markets in African countries.

The present document tries to show what is at stake in this chicken saga.It is the result of joint efforts

of seven European organizations,supported by a number ofAfrican organizations,which are directlyinvolved in awareness and mobilization campaigns in Africa.


4/20

P A G E 4

> Panorama of world markets

After pork, poultry meat is the most produced and most eaten meat in the world (12 kg/head/year

in 2003) (1). Wide spread battery farming or off the ground breeding methods have reduced pro-

duction costs and,more important, breeding time.It also introduced standard production methods

and products, making relocation an easy choice.

Chicken meat accounts for about 85% of poultry meat produced world-wide (2).

Development of world markets. Growth of world-wide chicken meat production is spectacular. It can be explained by

rising standards of living in certain countries, as in China, which has led to rising per capita con-sumption of meat. Rationalization of production methods is another reason.

The worlds meat production rose by a factor of 1,5 between 1970 and 2003; production of chicken

meat by a factor 4 during the same period, whereas exports rose by a factor 13 between 1970

and 2000.

In 2003, 4 countries covered 2/3 of the worlds poultry production: USA (23%), China (19%),

EU (12%) and Brazil (11%). 4 countries cover 90% of the words poultry meat exports: USA (36%),

Brazil (31%), EU (15%),and Thailand (8%).

To meet world wide demand, exporters engage in an intensive trade war on an extremely competi-

tive market. Brazil and Thailand manage to snap larger shares of the market thanks to their lower

production costs. Major importers are Russia (20% of world imports), Near and Middle East (15%),

EU (12%), Japan (9%), China (8%). The EU is loosing market shares on all export markets, except

for sub-Saharan Africa,which absorbs about 25% of European exports (3).

Position of the EU During the CAP reform of 1992, cereal prices came down, and so did prices for chicken feed, themost important element of poultry production costs. Since then, European exports have grown

150%.

Following the implementation of the Agricultural Agreement of the World Trade Organization

(WTO),subsidies for poultry exports have declined.Only 25% of exported quantities are subsidized,

i.e. deep frozen whole chicken exported to the Near and Middle East. But lower feed prices triggered

a fall of export costs to West Africa of 25% (4).

million tons production progression production progression exports progressioncarcass equivalent all categories chicken meat chicken meat

1970 100.606 13.132 482

1985 154.388 153% 27.530 210% 1.451 301%

1994 200.487 130% 43.589 158% 3.785 261%

2000 235.156 117% 58.992 135% 6.889 182%

2003 253.528 126% 65.015 149% notavailable

FAO data


5/20

C

h

ick

e

n

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica!

CHICKEN EXPORTS: EUROPE PLUCKS AFRICA! P A G E 5

Europe increased exports of cut-up chicken,which account for 65% of export volumes.The Europeanconsumer prefers chicken breasts and to a lesser degree, chicken legs. Other minor parts (wings,

necks, carcass, and rumps) are either processed into pet food, or deep frozen, and exported to West

African markets.

Position of Africa Sub-Saharan Africa covers only about 1,5% of the worlds chicken production (FAO 2003). Its role oninternational poultry markets is insignificant: only South Africa is developing exports of whole or

cut-up chicken, mainly for neighbour states (Tanzania!)

However,Central and West Africa import rising quantities of poultry from the EU,mostly deep frozen

chicken parts.

> Situation in African countriesIn the majority of developing countries poultry breeding,as an activity of poor family farms,in rural

or urban areas, is a vital element, when it comes to promote family farms, to create jobs and to

enhance food security (5). Now, in Africa,poultry imports keep growing since 1999 at a rate of 20% a

year, threatening local productions in their existence.

This promising African market is invaded by multinational groups, who control fully integrated

industrial chains (breeding processing-marketing). Among those, European companies, which

increase their production, relocate it in Brazil or Thailand, to reduce costs and prices. The logic oflowest possible costs is the dominating rule.

African countries have to open their markets for imports of farm products,and they have few possi-

bilities to protect their local producers. Result: imports of frozen chicken cuts, which the European

consumer does not want, virtually explode.

These products are thrown on African markets at knockdown prices, causing the overall price level

to decline sharply. The majority of local producers can no longer sell their products with a profit.

Their poverty ends up in malnutrition and hunger. Many abandon their farm,or breeding facilities,

and move into towns, where they increase the number of those suffering from urban misery.

Moreover, marketing conditions of frozen chicken cuts do not allow for safe conservation:salmonel-

lae and other bacteria quickly invade products offered for consumption.

> Poultry farming in AfricaIn Africa,as in many other developing countries, we find three different kinds of poultry farms: the

traditional hen house,improved small poultry farms,and semi-industrial poultry farming.

Each sector has its strong and weaker sides.

The traditional hen house,which still covers about 70% of the production,is usually a womens busi-

ness. Chicken breeding often is a complement to other farming activities of the family.

Chicken meat is an additional protein supply in the daily diet,but, for a number of cultural practices,


6/20

P A G E 6 CHICKEN EXPORTS: EUROPE PLUCKS AFRICA!

fowl is part of a dowry, or is used in funerals. Moreover, traditional chicken breeding is a walkingsavings accountor a feathered credit card,which generates additional vital income, when it comes

to cover health costs or childrens school fees.

Production costs are very low: only complementary feed is needed as chicken roam freely and eat

what they can find.

Local chicken varieties are appreciated by consumers,who usually live in the producers neighbour-

hood: he or she would attach the village chicken or bike chicken to a bicycle and sell them on the

local market.

So much for the positive elements; there are disadvantages as well: deficient management: cash flows

are not properly mastered. Marketing is hardly developed: the areas are too small and growing

demand in towns cannot be met. Support from public authorities: it does not exist for this form ofpoultry breeding.

Improved small poultry farms are generally promoted by local or international development organ-

izations as a means to fight against poverty. These farms, in rural areas or in urban suburbs,give an

opportunity to young people,women,small farmers,poor urban citizens, often grouped in cooper-

atives,or else, to retired people who want to invest their savings, to launch their own business.

With a few hundred birds per unit, this form of poultry farming requires only reasonable funding.

Production as well as income is higher than in traditional breeding farms. There are no negative

impacts on the environment, nor on the quality of the chicken produced (improved local varieties,

feeds and health conditions are under control).

Although improved poultry farming may cover a large part of urban demand,a number of restraints

confine this activity to a marginal role. One problem is financing: hardly any support from state

authorities, bank credits are out of reach.Another difficulty concerns insufficient processing equip-

ments and marketing facilities, especially in rural areas.

Semi-industrial poultry farming has been developing above all in South Africa, in Egypt and. to a

lesser extent, in Morocco and Algeria. More recently it also appeared in other states of West Africa

(Ivory Coast,Cameroon,and Senegal) close to urban centres,where demand is high.Quantities pro-

duces are obviously higher than in both preceding forms of farming (in Senegal it covers 4o% of the

overall domestic production). A great number of jobs are created,directly and indirectly:hatcheries,

industrial incubators, feed production units, breeding farms, slaughter houses etc.

This sector,however,has to rely on foreign companies to import improved varieties, feeds and expen-

sive medicines; this dependence is one of the sectors weaknesses. Furthermore, semi-industrial

poultry farming requires important funds, in reach only of businessmen, big traders, state officials,

or sometimes, smaller businessmen who are lucky enough to receive state aid.

Lack of professional know-how is frequent; it hampers proper management of intensive farming.

Problems of energy supplies often occur and marketing circles often fail. Finally, risks of environ-

mental hazards certainly do exist,just as the danger of producing poor quality chicken, which are so

familiar to Europeans.

In West and Central Africa, no country is able to produce enough poultry to be self- sufficient.

The development of this sector is therefore an important challenge.

However, despite difficulties and until now, the activity has been a profitable one in all three poultry

farming sectors.

Starting in the mid-nineties the massive imports of frozen chicken became a real catastrophe for


7/20

C

h

ick

e

n

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica!


farmers, womens associations and investors who had a stake in this business. Industrial poultryfarming was hit hardest; it had to reduce production sharply; traditional and improved farms are in

jeopardy, their development, and even their survival are as well.

Be they big, medium or small farmers, they all feel united by a common cause.Side by side they fight

to defend and save their national productions, to safeguard food sovereignty and the development of

their countries.

> Cameroon in the front line!

I started breeding in 1993, when I learned that chicken meat is essential for celebrationsand that there was a high demand for broilers on the market. Customers came to buy them

at the farm, and I had no problem to sell the rest on the market. At the beginning of 1999, I

noticed that for the big celebrations, the organizers no longer passed their orders to us And

they still served chicken to their guests. Thats when I learned about imported chicken. Very

soon I had to watch,as frozen chicken invaded my village. Mr. Jean Wakap, farmer inCameroon,testimony received by SAILD.

The impact of massive imports of frozen chicken into Cameroon, where more than 2/3 of the popu-

lation depend on breeding and/or farming, has been analysed in depth by two local associations

working together: Service dAppui aux Initiatives de Dveloppement (SAILD) and Association

citoyenne pour la Dfense des Intrts collectifs (ACDIC) (6). The data quoted hereafter stem fromtheir study (7).

It all began in 1997. The first chicken imports started in 1995, but in 1999 they really began to soar. In 1966Cameroon imported 978 tons of frozen chicken; in 2003, 22.154 tons, which means an annual aver-

age progression of roughly 300%.

Theoretically chicken imports to Cameroon need to be authorized for well defined quantities (quo-

tas). Imported volumes, however, systematically and largely exceed quotas as authorized by the

authorities. According to the SAILD/ACIDIC study, for every 100 tons authorized,300 tons are actu-

ally imported.

59,86 490,75978,31

3 286,27

7 593,35

11 946,2513 480,97

9 376,66

14 746,07

22 153,58

1994 1995 1996 1997 1998 1999 2000 2001 2002 20030

5 000

10 000

15 000

20 000

25 000

Source:

DOUALA harbour

administration(ACDIC-SAILD study)

Cameroon: chicken imports


8/20

P A G E 8 CHICKEN EXPORTS: EUROPE PLUCKS AFRICA!

These imports have a direct impact on local production.Between 1997 and 2000,as imports of frozenchicken rose from 3 300 to 13 500 tons, national poultry production decreased from 26 500 tons to

19 500 tons, a fall of 26%. In 2003, production fell another 40%, down to only 10 500 tons roughly.

For Cameroons producers this is a financial catastrophe, the situation also generates health prob-

lems for the populations.Analyses of the Pasteur Institute in Yaound prove it. 200 probes of frozen

imported chicken cuts have been taken by civil officers in 28 markets in 6 towns in Cameroon: 83,

5% of the probes do not match sanitary criteria; 15% are infested by salmonellae, which cause gas-

tro-enteritis and food intoxications; 20% carry campylobacter, which can cause infectious enteritis.

Quick results After these studies SAILD and ACDIC launched a vast campaign to inform and mobilize

Cameroons population: international press conferences, audiovisual press reports, meetings in theregion, seminars, information in foreign countries etc.A number of means have been used to pass

the information,and to try to reverse the course of things in Cameroon, with the aim of helping local

poultry farmers to resume production.

A first decision to temporarily suspend imports has been taken in the 3rd quarter of 2004. It could

be extended to several months. Production of 1 day chicks rose by 25% and frozen chicken can no

longer be seen on market stalls.

The citizens of Cameroon are on the lookout from now on: frozen chicken might well be the first case

of a series that will shape the countrys future development.

> Senegal: chicken for 250 FCFA per kiloPoverty is worsening in Senegal: 44% of a 10 million population are poor; 3/4 of them live in rural

areas where hunger is a regular experience.Agriculture employs 70% of the active population; still,

daily life means growing hardship for the great majority of farmers. The peanut and cotton crises,

two major export commodities,and the fact that the government is no longer active in these two sec-

tors, left rural populations in a state of misery. More and more the country has to rely on food

imports: their value tripled between 1992 and 1999, from 80 to 250 billion FCFA (8), while the coun-

trys foreign currency assets are dwindling.

Developing a national food production is an important challenge, and poultry would be one of the

major strategic sectors.

Increasing demand for poultry. Growing towns and weakening purchase power have increased consumption of poul-try,which is cheaper than other meat.From 1990 to 1997 it rose from 1,5 kg to 2,5 kg per person and

year.Development of local production would give Senegal an opportunity to create jobs and to reduce

its dependence of food imports.

Traditional family production cannot match rising urban demand because of inexistent support and

insufficient infrastructures. Instead, semi-industrial farms developed around major towns (Dakar,

Ziguinchor, Saint-Louis,Kaolak, Touba and This) with the help of private funds estimated at 30 bil-

lion FCFA (46 million) during the last ten years.In 2000, this modern sector produced 8000 tonsof poultry, on top of a traditional production of about 16 000 tons.


9/20

C

h

ick

e

n

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica!


10 000 jobs have been created (incuba-tors,feed production,slaughtering etc)

as well as a market for locally produced

cereals,as the sector bought about 50%

of corn crops needed by the coun-

try.(57 000 tons of corn in 2002).These

modern farms however generate prob-

lems of product quality, environment

hazards and working conditions.

Despite of this potential, low priced

import literally soared! A tenfoldincrease in 5 years,reaching 11 950 tons

in 2003.

Comparing prices is a revealing exercise:

the country chickenlocally produced in family farms costs between 1.500 and 2000 FCFA/kg (2,30

to 3/kg)

locally marketed chicken is bought at 1.250 FCFA/kg from producers(1,9 ) and sold at about 1,486

FCFA/kg (2,30 /kg) on the market place.

imported chicken is landed at 250 FCFA/kg (0,38 ). After taxes and import margins, it is sold forless than 1000 FCFA/kg (1,50/kg) on the market.

The local commercial sector is more vulnerable and is the first to be hit by cases of bankruptcy.

Producer organizations estimate that about 70% of commercial farms have disappeared (9),and with

them, 1 500 to 2 000 jobs. Traditional poultry farming did also suffer, although the result is hardly

visible: official statistics are scarce, and unsold chicken remain at the farm; the families concerned

are loosing part of badly needed income.

The case of Senegal is certainly not unique in West Africa. In Togo imports rose 410% between 1992

and 2003, whereas local production declined by 25% from 2000 to 2002 alone (10). In Ivory Coast, the

quantity of imported frozen chicken and giblets rose from 2 152 tons in 2001 to 5 676 in 2002 and

reached 15 400 tons in 2003, destroying more than 15 000 jobs in the local poultry sector (11).

To protect the sector is difficult Customs tariffs on cut-up chicken decreased from 55% in 1998 to 20% in 2002.Senegalis still entitled,within WTO rules, to impose a 150% customs tax. But it does not use that right, as it

is a member of the West African Economic and Monetary Union (UMEOA), and because of con-

straints imposed by plans for structural adjustments of the International Monetary Fund (IMF).

Conflicting interests do exist in this area. On one side, some producers make a comfortable profit,

selling frozen products,and of course,are opposed to any reduction of the flow of goods.On the other,

associations of poultry breeding women, small farmers and the industrial sector,represented by the

National Federation of Poultry Producers (FAFA), request stronger customs protection, combined

with measures to support the development of the sector (credits, investments etc).

4 000

2 000

14 000

4 000

6 000

8 000

10 000

12 000

1999 2000 2001 2002 2003

Local poultry production

Imports of poultry meat

From:Direction of

forcasts and statistics

and Directorate of

cattle breeding Senegal.


10/20

P A G E 1 0 CHICKEN EXPORTS: EUROPE PLUCKS AFRICA!

> The political context in African countries

The European Union had been able, during 40 years, to develop its agriculture, protecting it from

imports coming from more competitivecountries.For a number of reasons,African countries have

no possibility to do the same.

Structural adjustment plans. Room for manoeuvre in agricultural or trade policy had been strongly reduced since the80s. The decline of commodity prices on world markets, combined with failing macro-economic

policies and budgetary laxity,caused the decline of the economic situation in West African countries.

Their exterior debt rose sharply. The IMF and the World Bank (WB) imposed the implementation of

structural adjustment plans as a precondition for loans with preferential rates and debt reducingmeasures. The recipe was the same everywhere:adaptation to the rules of market economy, in

other words, economic and financial liberalization and growth.

In fact, African countries have been forced to lower their customs barriers, to reduce aid to agricul-

ture, to abolish monitoring of prices, or to promote exports of some goods which enjoyed a com-

parative advantage.

After severe criticism about the socially and politically disastrous consequences of such plans, the

IMF and WB say that the fight against poverty is now at the centre of their mission,and that policies

must be adapted to specific contexts. Each country must now design its own national strategy to

reduce poverty.

These are certainly praiseworthy intentions,but those nationalstrategies,under the decisive influ-

ence of such institutions, will hardly do anything else but follow the adjustment plans.Anyway, an

increase of protection at the borders is not on the agenda.

Regional integration: UEMOA as an example. Imitating the EU,several adjacent countries have engaged in cooper-ation policies,notably in the commercial field,to take advantage of complementarities,to enlarge the

scale of their economy and to create bigger, more attractive markets. In West and Central Africa,

regional cooperation was facilitated by the existing common currency, the FCFA, stemming from

colonial times (12).

The creation of UEMOA in 1994 (Benin, Burkina Faso, Ivory Coast, Guinea Bissau, Mali, Niger,

Senegal, Togo) promoted convergence of economic policies through the creation of a common mar-ket, based on freedom of movement for people, goods,services and capital. UEMOA is expected to

improve competitiveness of economic and financial activities.

It is a follow-up of efforts to promote economic integration, made for years by several countries of

West as well as Central Africa.

In 1975 already, the Community of West African States ( CEDEAO) formed a group of the present 8

members of UEMOA plus Cape Verde Islands, Gambia, Guinea, Liberia, Nigeria and Sierra Leone.

Economic integration in all fields of activity (including agriculture),did not succeed, really; and is

even less advanced today than it is for UEMOA.It is making faster progress, though, as an economic

partnership agreement is negotiated with the EU.

Customs duties within the UEMOA One of the important achievements of UEMOA is the creation of a customs union,with a Common External Tariff consisting of 4 different rates of customs duties:


11/20

C

h

ick

e

n

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica!

CHICKEN EXPORTS: EUROPE PLUCKS AFRICA! P A G E 1 1

> 0% on corporate assets> 5% on staples, raw materials,equipments,farm inputs,> 10% on semi finished goods> 20% on finished consumer goods; this rate applies to poultry cuts

Rates rise with the degree of processing of the product, in logic of protecting the national processing

industry.Classification of goods in one or the other of the above categories is not always clear,though,

especially not for farm products.Milk powder for instance,falls in the first category,which allows for

imports competing with national productions.

The 20% rate,applied to frozen poultry cuts (wings,rumps,legs) imported from the EU,is to low,as

it allows these products to be marketed at 1/3 the price of locally produced chicken.And WTO? The Agricultural Agreement of WTO entered into force on 1 July 1995.Its implementation was spread

over a period of 6 years for developed countries and 10 years for developing countries.Renegotiation

started on 1 January 2000. It intends to bring some discipline into international trade with farm

products, limiting the use of agricultural policy instruments with negative or distorting effects on

the world market.Three sectors are covered: access to markets (imports) national aid to agriculture

and export competition (export subsidies).

Market access covers farm product imports into third countries.Border protection measures (13) are

replaced by fixed customs duties, which are then liable to reductions.

Developed countries have reduced their duties by 36%; developing countries by 24%; Least

Developed Countries (LDC) (14) are exempted from reductions. On the other hand, national marketsmust offer minimum openings equivalent to 5% of the product consumption. When prices of

imported goods fall sharply, and imports threaten national production, a country may rely on spe-

cial safeguard clauses,which allow it to temporarily protect its market with additional duties of 30%.

However, developing countries are free to determine the level of their customs duties (so called ceil-

ing rates). The majority of countries preferred this option and may not use the special safeguard

clause: it is estimated that they would choose rates high enough to protect their markets efficiently.

Some of Africas ceiling rates:

Benin: 79%

Burkina Faso: 150% Cameroon: 230% Ivory Coast: 200% Nigeria: 150% Senegal: 150% Togo: 80%

These rates do not apply, as structural adjustment plans impose a decrease of trade barriers.

On top of these customs barriers, some countries adopt various measures to avoid massive imports

into their national markets: anti-dumping measures for instance. Cameroon claims that dumping

exists when the selling price of imported goods is lower than the price normally asked for in thecountry of origin (law 98/012). The country concerned, however, has the onus of proof, and must

notify WTO before it reverts to anti-dumping legislation; in such a case, rates must not exceed the

price difference found.


12/20


Safeguard measures may be considered if a product is imported in such quantities as to cause, or tothreaten to cause, important damage to national production of the same product. In such a case,

Cameroon resorts to raising its duties for a maximum of 200 days (law 98/012). Such action,includ-

ing the law, must also be notified to WTO.

In the case of poultry, the use of anti-dumping measures rarely occurs. Poultry meat is not subsi-

dized in Europe. Strictly speaking, there is no unfair competition. For the EU, it rather is an escape

market.As a consequence,the only possible responses are those which are limited in time.

Countries choose to protect themselves. Nonetheless, some countries have chosen to protect their

local production, sharply raising their customs duties, even banning poultry imports. In 2004,

Nigeria and Mali simply have prohibited imports of European frozen chicken into their territories.Burkina Faso had done the same in 2002. These three countries deliberately decided to disregard

WTO rules. Theoretically, the EU would be entitled to launch a procedure before the WTO dispute

settlement body (DSB),but is unlikely that it will do so, for several reasons:

Should the DSB decide in its favour, the EU would be entitled to use commercial retaliation, for

instance, raise duties on imports from Mali, Burkina Faso, or Nigeria. Exports from these countries

are too insignificant to do so.

Costs for such actions are high, compared to modest advantages, or even possible damages. Exports

of poultry cuts cause enormous damage in receiving markets,but they are only a drop in the ocean

of European economy.

It would be difficult for the EU to provide political justification for such a procedure against these

countries,which are among the poorest of the world.

Opinions of other operators in Africa: consumers and importers.It is the price of poultry meat which makes it a hit among consumers. The economic crisis,devalua-

tion of the FCFA and privatization has eroded households purchase power.

Imported meat,though less tasty,which can be bought by weight according to the needs and purse,

is an opportunity. Local poultry, traditional chicken or improved varieties, is sold alive,and is often

out of reach,except for outstanding occasions. Slaughtering and plucking comes on top. Easy cook-

ing is an additional advantage; snobbishness drives some customers to buy European chicken only.

However, the quality of this meat, which is often circulated in disregard of the refrigeration chain,

poses a serious problem.

African importers of frozen meat claim that competitiveness is the master trump.They do not appre-

ciate rising duties, and fight to keep them on low levels. They hardly ever share efforts to protect or

develop local production.


13/20

C

h

ick

e

n

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica!


> The poultry sector in France and in Europe

European poultry farming: export at any price! Within Europes poultry industry, exports became the major goal(mainly chicken and turkey) in the 1970s, when production as well as exports rocketed.

France became the first producer in Europe, raising production from 238 000 tons in 1980 to more

than 2 million tons in 2001. It covers almost 25% of Europes production. France also is the first

exporter to third (outside EU) countries and the second (after the Netherlands) for exports to other

Eu members.

With a total production of 9 million tons today, the EU tries to keep its leading role in internationaltrade, doubling its chicken exports between 1990 and 2001, from about 400 000 tons to more than 1

million tons. Exports of frozen chicken and turkey cuts kept rising and represent about 2/3 of total

exports today.

European production and exports are on the decline though.France,in particular,is affected by this

development.

Intensive poultry industry in France and Europe Throughout the world, poultry production and consumption reachabout 25 million tons, which is a source of fierce competition between Europe, the USA, Brazil and

Thailand.

This logic of cut throat competition pushed the French and European poultry farmers to intensify

their industry. The production sites, mainly concentrated in Brittany ( Morbihan, Ctes dArmor,

Finistre, Ille et Vilaine) and Loire country, have an important impact on the environment (nitrate

pollution) and the economy of these regions (dependence on market fluctuations). Moreover, con-

centration of breeding sites in limited zones increases risks of spreading diseases like avian flu.

In the Morbihan region,the top department for poultry breeding (187 000 tons of Chicken,156 000

tons of turkey and 12 540 tons of ducks), the number of breeders fell from 1 724 in 1988 to 1 550 in

1997, while the average size of breeding units rose considerably (from 1 689 m2 in 1988-1989 to

2 0 3 0 m2 in 1999-2000), as did production figures (chicken: 126 000 tons in 1985; 187 000 tons in

1995)

In Belgium the supply rate of standard meat chicken (production + imports exports) is high.It turns around 170% making the Belgo-Luxembourg Economic Union (UEBL), all things consid-

ered, one of the greatest exporters of the EU. Belgium exports more or less 50% of its production

of standard meat chicken, 2/3 of it to EU countries. (Holland about 50%, France about 25%, the

rest to Germany and United Kingdom). Belgian exports mainly come from farms in the North of

the country.

Imports into the UEBL mostly come from the same countries (France and Holland). In the last few

years though,poultry imports from third countries (Brazil and Thailand) have been rising,as import

duties on these products (marinated and uncooked preparations) are lower and production costs are

much lower as well. As an example, the UEBL increased its imports from third countries by 1/3 in

2001 compared to 2000. Opening markets to Asia will not go without problems,notably because ofrelocations, which are certainly to come.


14/20


Consequences of this frantic competition Poultry breeding in Europe is deeply integrated in ever more concen-trated food processing conglomerates. Despite intensive breeding (average of 25 units per m2) and

higher productivity, gross annual revenues continue to decline (-31, 8% per m2 between 1981 and

2000)

In the food processing sector of the industry (slaughter houses, for example) working conditions are

difficult, jobs are insecure and badly paid. The economic situation forces many sites to close shop

while others are relocated in Brazil,Thailand or China. These countries do better on the world mar-

kets as they offer lower production costs. The bigger companies obtain up to 60% of their turnover

in these countries.Meanwhile, European imports grew at a very fast rate: 330 000 tons in 1999,more

than 700 000 tons in 2001. In 2003, chicken meat imports from third countries covered 10% of con-

sumption in Europe.Two countries alone accounted for 88% of these imports: Brazil (55%) and Thailand (33%).

Agribusiness and relocations. Low cost imports,coming from relocated production sites,worsen the crisis of the Frenchpoultry sector. Insisting on the higher competitiveness of their production sites abroad, some

agribusiness groups ask their breeders to revise their annual contracts downwards, while breeders

investment needs keep growing and their prices keep falling

Moreover,multinational groups sometimes take advantage of European export subsidies, when their

exports go to non EU countries, to the Middle East for instance.

> Newcomers in international tradeWhen it comes to dealing with international trade, of farming products in particular, it is tempting

to consider developing countries as one group. They differ though, in many aspects, and these dif-

ferences exist in the poultry sector as well.

The poorest countries, in Africa above all,still have traditional productions; they suffer from outside

competition caused by imported goods. It is not the case for so called emergingcountries, whose

production structures are radically different.

In Brazil, China or Thailand, the development of agriculture can be compared with Europes devel-

opment during the 1960s.Poultry production growth is very high; several factors help to explain this.

Urban demand progresses. The development of industry and service sectors has triggered the expansion of urban areasand the emergence of well paid middle class.Rising standards of living change eating habits,the pro-

portion of meat in diets increases. Poultry meat is the cheapest ( faster growth, faster transforma-

tion of feeds into meat) and this meat becomes the first choice of consumers. It is considered to be a

low fat meat,which confers a favourable image.Urban demand stimulates production and, in the case

of Brazil and Thailand, promotes exports as well

Using modern farming techniques. In emerging countries traditional poultry farming and family farms coexist withhighly intensive off ground production sites,similar to those in Europe or the USA.Such production

units are imported,ready to start and integrated as in developed countries. This certainly is the casein China and Brazil. Negative consequences of intensive production have been highlighted many

times: Besides pollution problems linked to quantities of droppings, the concentration of fast grow-


15/20

C

h

ick

e

n

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica!


ing birds favours the outbreak and propagation of infectious diseases. In Thailand, which exportssome 90% of its poultry production,and where the majority of poultry farms are concentrated in the

biggest agribusiness companies, the outbreak of the avian flu was a terrible blow for the national

economy. To avoid the disease to spread further, authorities imposed the construction of closed

breeding facilities. Such investments are out of reach for thousands of small family farms, working

side by side with giant groups.A great number had to give up farming (15).

Competitive production costs In 1999 already, a study of the French Aviculture Institute demonstrated that productioncosts of a Brazilian chicken ( leaving the breeding station) was 45% lower than the costs of a French

chicken. Such differences, which have been confirmed meanwhile, show the advantages of Brazils

poultry breeding sector: cheap corn and soybean supplies; low labour costs; lax environment pro-

tection rules; and a weakening Real, Brazils currency,which boosts competitiveness as it lost 38% ofits value during the first 9 months of 2002.

Today production costs for one kilo of standard French chicken are 70% higher than in Brazil

(1,25/kg in France against 0,74 /kg in Brazil).(16)

Very liberal countries Brazil and Thailand are more and more present on world markets of farm products,espe-cially with chicken meat.During trade negotiations within WTO,they jointly defend (within the G20

group) very liberal positions, asking for a faster opening of markets and lower supports for farm

products in developed countries. These positions differ from those of African countries,who adopt

a rather defensive attitude, and who wish to protect their agriculture from low priced imports.

Brazil and Thailand actually sell these types of products on African markets: frozen chicken cutsfrom Brazil and broken rice from Thailand.

The development of chicken meat production in Brazil was spectacular, rising from 200 000 tons at

the beginning of the 70s to 1, 2 million tons in the 80s and to more than 4 million tons today. 14% of

this production is exported.

Production developed mainly in the South of the country, in a region of small family farms, where

battery breeding allows to generate higher income without increasing surfaces.Chicken are fed with

corn and soya from local production (30% of Brazils corn is fed to chicken).The sector is highly inte-

grated,5 companies share the market.(17)

In 1999 the French company Doux, the first in Europe and 3rd in the world, set foot in Brazil, buy-ing FrangoSul.In 2002 its production in Brazil accounted for about half of the Doux groups turnover.

Of its total staff of 15 000, 7000 work in Brazil, 8 000 in Europe.


16/20


> The European context:Agreements for an economic partnership

Trade relations EU-ACP In 1975 the Lom convention set the frame for cooperation between the EU and countries ofAfrica, the Caribbean and the Pacific,granting privileged trade relations to the latter: products from

ACP countries were allowed to enter European territory without limitations or customs duties,except

for sensitive farm products (European production, or products under CAP rules, as some fruit and

vegetables, sugar, bananas and beef). These trade preferences have been confirmed during later

renewals of the Lom Convention.The Cotonou Agreement, signed in June 2000 after 18 months of negotiations, radically changes

EU-ACP trade relations. As a matter of fact, the Lom Convention disregarded two major WTO

principles:

the principal of reciprocity: Normally the EU is not allowed to grant trade preferences

the principal of the most favoured nation: normally the EU can grant trade preferences only to ACP

countries among developing countries.

In order to restore compatibility between EU-ACP relations and WTO rules, Economic Partnership

Agreements (EPA) are to be adopted about 2008.

Economic Partnership Agreements These agreements stipulate the creation of free trade zones (covering a large partof trade currents 18) between the EU and effective regional common markets among groups of ACP

countries.These EPAs shall be organized for 1 January 2008 at the latest.There is no obligation for

ACP countries to join the system; but if the do not, they will be submitted to the general rules,

which the EU applies to other developing countries,and they would lose a number of commercial

advantages.

What are the consequences for ACP countries?

EPAs are the bridge for reciprocity between ACP and EU

For ACP countries,which already enjoy wide access to European markets,the benefits are minimal.

On the contrary,they would be forced to open their markets for European products. In the farming

sector,already suffering from competition of European products (from farms with greater produc-

tivity and supported by CAP) consequences would be dramatic, if no protective measures were

taken.

Moreover, access to European markets means that more and more public health requirements must

be met, which ACP countries are hardly able to cope with.

Finally, ACP countries are facing a two-fold negotiation: create regional common markets among

themselves first, and then launch free trade zones with the EU. This would be the time to negotiate

exceptions to free trade rules.

The timetable

The first year of these negotiations, which started in September 2002,has been dedicated to discus-

sions between EU and APC countries. The EU pleaded in favour of the greatest possible compatibil-


17/20

C

h

ick

e

n

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica!


ity between EPAs and WTO rules. The ACP countries underlined the need to take into account thecosts for adjusting their economies.

In September 2003, the negotiations between EU and ACP regions were launched. The agenda of

these negotiations have been established for several regions, West Africa and Central Africa, for

instance.A precise timetable for these negotiations has been set up.They are to be concluded in 2007

and should be applicable as of 1 January 2008.A transition period granted to ACP countries, to allow

for progressive liberalization, could be extended until 2020.

>A campaign with many facetsThe debate on massive imports of European chicken to Africa touches on many elements.One cannot

avoid considering ethical problems as well, regarding the directions for economic development of

African regions,as well as relations between NGOs, in the North and in the South.

An ethical problem? Exports of frozen products to countries, which are known to lack in infrastructures needed for acompetitive local production,give reason for concern.

Sending cast-offs, which the European consumer does not want, to third countries triggers highly

ethical interrogations: the companies concerned will be held responsible for their practice and pro-

fessional ethics. If they do not react, consumer-citizens will, no doubt, be entitled to launch cam-

paigns to have them face the problem.

Protectionists? Far from being protectionist, to protect national borders in order to lay the foundations for devel-opment, is a basic right and an adequate policy. Has not the EU, for more than 40 years, protected

its agriculture against imports from more competitive countries? This attitude helped to develop

trade within the community as well as the European agriculture.

Africa must be allowed to follow the same road, to choose its own rhythm and priorities. This is

the goal and the reason why regional integration in Africa must be promoted. It will generate

regional agreements, which will favour trade within one given area.

North and South? The present campaign came into being because civil organizations in African society called for it. Itis a concrete example of a dialogue,of exchange and encounters between North and South.Opinions

and analyses in this document do not always correspond to priorities chosen by African organiza-

tions,and criticism may choose different angles.Our exchange of ideas will therefore be more fertile,

our common mobilization more efficient.

The global character of the question must be stressed, though.Changes of the CAP in Europe will

have impacts in countries of the South; multilateral negotiations are the only road towards inter-

national trade regulations,which could bring greater fairness and justice.European organizations

take their part in this campaign, operating in the North, putting pressure on governments and

institutions dominated by the richer countries. Similarly, organizations of civil society in Africa

call upon their own authorities to have them consider this question, and to put an end to a situa-

tion which generates growing poverty. This two-fold action, in the North and in the South, must

aim at common objectives. The problem of frozen chicken imports provides both African and

European civil organizations with an opportunity for joint action.And that is not the least goal in

such a campaign.


18/20


What about farmers in the North? Poultry farmers and the staff of chicken processing companies live through a majorcrisis these days. They have to face similar questions as those African farmers are confronted with.

European farmers are themselves affected by high geared liberalization. Relocations reduce employ-

ment; intensive production methods damage the environment; overproduction is the reason for

dumping practices in countries of the South.

Are the problems of the North destined to be exported to the South as well?

Essential questions must be asked in both hemispheres of the globe: how to manage production out-

puts to avoid selling surpluses on other markets? How to secure sustainable production while

respecting people and their environment?

And about consumers in the South Frozen chicken is a source of food for the poor. The trouble is that opening marketsfor massive imports will create greater poverty for greater numbers, not only in the poultry sector,

but upstream and downstream as well.

Imports of chicken cuts are symptomatic of the need to regulate international trade in favour of the

poorest countries, but also to respect the right of people to choose what they want to eat.

This right and the right to choose their own development are part of their basic freedoms.Food sov-

ereignty is one element that helps to rid oneself of imposed dependence.

Farmers from North and South have a common interest to unite and to preserve a model of agricul-

ture which respects man, which is based on sustainable family farms, and which is able to provide

food and development to all. These goals are defended by farmers organizations and NGOs in the

North and in the South,notably in the Dakar Declaration of May 2003(19) and the European Platform

on food sovereignty.


19/20

C

h

ick

e

n

E

xp

o

rts:

E

u

ro

p

e

p

lu

cks

A

frica!


Notes

1 OFIVAL, 2004 Le march des produits avicoles en 2003.

2 FAO stat, 2003.

3 OFIVAL, 2004 Le march des produits avicoles en 2003.

4 Agritrade, Quoi de neuf? n30, septembre 2004.

5 Food security: exists when any individual has access anytime, anywhere to healthy and sufficient food to cover his/her needs, taking

into account eating habits.

6 To know more about SAILD: www.saild.org; or on ACDIC: www.acdic.org

7 Limportation massive de poulet congel au Cameroun: Etat des lieux, enjeux et alternatives. SAILD/ACDIC, avril 2004, disponiblesur: http://www.aprodev.net/trade/Files/JAP/Poulet_congele.doc

8 Devaluation of the FCFA (1994-1995) reduces this increase in foreign currency.

9 Effets pervers de l'importation de poulets congels en Afrique le cas du Sngal, Momar NDAO, ASCOSEN.

10 Les importations de poulets de chair au Togo en provenance de lUnion europenne, De Coster Tchalla, aot 2004.

11 Evaluation IPRAVI.

12 The CFA Frank, tied to the Euro, is the currency in two sub-regions: UEMOA with Benin, Burkina Faso, Ivory Coast, Guinea Bissau,

Mali, Niger, Senegal and Togo) and CEMAC: Cameroon, Centrafrique, Congo, Gabon, Equatorial Guinea, Chad).

13 Quotas or import licences, various taxes.

14 Among them many African countries, like Senegal, Mali, Burkina Faso, Benin, Togo, but not Cameroon nor Ivory coast.

15 Isabelle Delforge, En Thalande, les sacrifis de la grippe aviaire, Le Monde Diplomatique, juillet 2004.

16 Itavi, 2002.

17 Mmo ProsPER Cne Sud, CIRAD.18 Article XXIV du GATT.

19 Available on: http://www.roppa-ao.org

For more information on the subject Chicken Connexion,le poulet africain touff par lEurope,agrobusiness,dumping,souverainet

alimentaire,GRESEA.

Impact of import surges, country case study results Senegal, FAO, avril 2004, CCP:ME 04/2.

Impact des importations de volailles en Afrique de l'Ouest,enqute ralise par le rseau Syfia

International pour le CCFD,avril 2004.

La souverainet alimentaire lpreuve de la mondialisation, Bndicte Hermelin, Cahier de la

Solidarit, CRID, juin 2004.

African poultry farming facing imports of deep frozen chicken, Farming dynamics n4,may 2004, SOS Faim.

Les importations de poulets de chair au Togo en provenance de lUnion europenne,De Coster et

Tchalla, aot 2004.

Sngal,coup de froid sur la basse-cour,Faim et dveloppement magazine - CCFD,n197,octo-

bre 2004.

Stop dumping, promote food security,Germanwatch, 2004.


20/20

Documents

Poulets Foundation En