Norton says banning imported chicken will trigger surge in prices
Opposition Leader, Aubrey Norton yesterday lashed out at the government’s decision to place a ban on the importation of poultry and poultry products, as according to him it has not taken into consideration that the stricture will likely trigger a surge in prices.
At his party’s press conference yesterday, Norton pointed out that there were different reasons given by government officials for the ban “from health concerns to smuggling to the need to protect local farmers from competition”, however, he added that nowhere in the various explanations “do we detect any concern for the likely surge in chicken prices on the local market that a ban on imports would trigger.”
According to him, “banning by itself cannot solve the problem”, adding that “the government’s stand-alone ban on imported chicken is a manifestation of its incompetence and confused policy-making.”
Stating that the Opposition supports the local chicken industry, he however noted that banning as a stand-alone measure will result in an increase in local chicken prices and therefore there must be other measures to ensure “we protect the industry while at the same time ensuring the cost of chicken does not go up.”
He opined that the ban essentially exposes the government’s “simplistic and inept thinking and planning.”
The Guyana Livestock Development Authority (GLDA) last week gave notice that poultry and poultry products would not be allowed into the country, and following the announcement while pointing to the surplus of local chicken on the market, Minister of Agriculture, Zulfikar Mustapha, said that the government was protecting the local farmers, as he assured that the country has enough stock.
Mustapha had further explained that the ban was intended to protect local farmers while also safeguarding against bird flu. He emphasized that because of the current large supply, chicken prices will not increase.
“We have put a ban on the importation of chicken because we have enough chicken in the country. The supplies are there
from local farmers and also we have to protect the local farmers,” he told members of the media.
“Also we are looking at the sanitary outcome of it, because of the bird flu some countries in the hemisphere had the bird flu too. So we are taking a lot of precautions. But that doesn’t mean that because we stop the importation of chicken the prices will increase. We have enough chicken,” he had assured.
The Minister of Agriculture also said that assurances were given from the Guyana Poultry Producers Association (GPPA) when he had held a meeting with them, that there were enough supplies and thus there was no need for importation of the products.
Cross-country
In addition, he disclosed that his ministry has also conducted a cross-country analysis which revealed that there is enough poultry here. “The Guyana poultry dealers association told me, I have had a meeting with them and they told me we have enough supplies and there are a number of farmers who are getting more supplies. The market has been saturated with enough local chicken there is no need to import any chicken,” he said.
“The Ministry of Agriculture that has the responsibility for the importation or giving the approval, we have done analysis in the country and there is enough production of chicken and poultry products to satisfy the local needs,” he added.
However, yesterday Norton stated that if the ban is intended to protect local producers from foreign competition then this is a “completely wrongheaded approach” to industrial policy. He explained, “To lower local costs, the government should remove all remaining taxes from local chicken production and take measures to lower the costs of feedstock, including removing taxes from soya beans and corn which are critical to feed production.”
Further, he said, that the government must also offer more technical support to farmers. “To expand local chicken production, measures should also include easy access by producers to low-cost start-up and development financing. In addition, small chicken farmers should be given grants in a structured and non-politicized way with the aim of making them competitive while reducing the cost of production.”
Opportune
He said that it would be an opportune time for measures to promote chicken production in regions 1, 7, 8, and 10 where output lags demand.
Meanwhile, he also questioned that if the ban is intended to address a smuggling problem then why is the government not announcing a series of anti-smuggling measures? Secondly, he further questioned, “If this ban is intended to address imported chicken health concerns, then a ban that increases the amount of chicken smuggled into Guyana will only exacerbate the health risk, as legal importation is replaced with totally unregulated activities.”
The Opposition Leader then contended that had the government genuinely wanted to take action against a potential bird flu threat then it should have done so in January when PAHO issued its warning instead of several months later when the country may have already been exposed.
Furthermore, he stated that a ban on imports to protect local industries opens the door for similar government action for other imported products. “We do not believe that in today’s free trade environment, this bodes well for Guyana and Guyanese. Bans on imports can trigger retaliatory embargoes on Guyana’s exports. Bans on imports will also create a protectionist environment that will delay or discourage the uptake by local producers of new technology, new processes and input materials, and the use of efficient supply chain and marketing techniques. Customers will pay the ultimate price in the form of high costs and low quality of goods.”
Meanwhile, Vice President, Bharrat
Jagdeo at his press conference yesterday stated that presently the prices of chicken are low and the poultry farmers have been questioning the government as to what they would do to assist them since there was surplus chicken being imported driving down the prices.
However, Jagdeo said that Norton does not understand the details of the sector itself stressing that presently Guyana is producing about 140 million pounds of chicken per annum with about 18,000 people earning a livelihood within the industry.
Further stressing that his government has a comprehensive plan, Jagdeo said since regaining office they have given access to land for five additional large poultry farms – about 10,000 birds per week. “We’re allowing hatcheries and everything to come in duty-free. We have zero-rated all of the poultry inputs and veterinary supplies for the industry.”
Additionally, he pointed out that after returning to office, they discovered that one of the biggest vulnerabilities to the local poultry industry was the variable price for the input into feed product “so we met with all the poultry farmers and we said we have to work together to produce the corn and soya here… They have started that project it’s growing and within three years we will be self-sufficient with corn and soya.”
He stressed, that “It is a comprehensive approach to the industry to generate a local industry...”