Nicholas A. Linacre
The University of Melbourne, Australia
Regina Birner
University of Hohenheim, Germany

Access to agricultural technology is important for increasing food security and promoting development in many low-income countries. Increasingly, donor agencies and development institutions are supporting the creation of regional capacity for the assessment and approval of genetically modified organisms as a way to promote agricultural development. In this article we examine the regulatory design risks associated with developing sustainable financing for regional implementations of the Cartegena Biosafety Protocol, which provides an international framework for the regulation of transboundary movements of genetically modified organisms. West Africa provides considerable insight into the potential design risks associated with providing sustainable financing of regional regulation. In West Africa, development institutions are increasingly providing financial support for the development of regional regulatory frameworks to facilitate the introduction of Bt cotton. The regional approach is supported by market-levy-based financing initiatives; however, a market does not currently exist for Bt cotton in West Africa. Our results show that using the market levy may create financial incentives for the regulatory agencies to approve and promote the adoption of Bt technology without appropriate processes being followed. Alternative funding mechanisms are evaluated suggesting that a suitably designed financial guarantee may be a prudent approach to mitigate any risks that may arise from financial short falls in the early years of a regional regulatory system.

Key words: Food security, regulation, risk, sustainability, environment, biodiversity, GMO, biosafety, public policy, finance.