Cost of Compliance with Biotechnology Regulation in the Philippines: Implications for Developing Countries

Jessica C. Bayer
Budget Office in the City of Norfolk, Virginia
George W. Norton
Virginia Tech
Jose B. Falck-Zepeda
International Food Policy Research Institute

Direct and opportunity costs of regulation are presented for four transgenic products in the Philippines: Bt eggplant, Bt rice, ringspot- virus-resistant papaya, and virus-resistant tomatoes. Understanding the magnitude of these costs is important for evaluating potential net benefits of genetically modified crops, both for countries that are designing their regulatory procedures and for those implementing them. Results indicate that direct regulatory costs are significant but generally smaller than technology development costs. However, the cost of foregone benefits stemming from even a relatively brief delay in product release, which might be due to unexpected regulatory delays, overshadows both research and regulatory costs. Regulatory systems must ensure that none of the steps in its regulatory process for GM products that are required to protect public safety and the environment are omitted, but unnecessary steps are costly. Direct regulatory costs appear to be declining within countries as they gain experience with more products.

Key words: agricultural biotechnology, biosafety, genetically modified crops, GMO, regulatory costs.