Saturday, July 13, 2024

How the Ministry of Agriculture lost the EU beef Market

If the Botswana Department of Veterinary Services has made one thing clear over the past few years, it is that they have no qualms about being caught in a lie.

In their dealing with the European Union, that has meant falsifying reports to create an impression that Botswana was complying with requirements of the European Union beef market.

European Union (EU) and Food & Agriculture Organization (FAO) documents passed to the
Sunday Standard reveal that through a combination of mismanagement, negligence and malfeasance, the Ministry of Agriculture’s (MOA) Department of Veterinary Services (DVS) was responsible for the EU deciding in January 2011 of removing BMC’s Lobatse and Francistown abattoirs from its list of approved export abattoirs. Article 12 of EU Regulation No 854/2004 requires that fresh meat may only be imported into the EU from abattoirs that appear on the EU’s list of approved export abattoirs.

The consequences of EU delisting have been dire. For at least nine months, the BMC will be shut out of its highest value export market accounting for 65 percent of total BMC sales. And because Veterinary Departments in many non-EU countries apply EU hygiene and traceability standards, they also require export abattoirs to be EU listed.

In other words, when the BMC lost access to the EU, it simultaneously lost access to most other markets around the world. As a result, the BMC is projecting a half billion Pula loss in revenue for the first three quarters of 2011 and an almost 50 percent drop in throughput from 187,000 head in 2010 to less that 100,000 head in 2011.

Unable to export to the EU and prevented from exporting to RSA due to a Foot and Mouth (FMD) outbreak, the BMC accumulated a huge surplus of beef which couldn’t be accommodated in its limited storage facilities. The BMC sought to mitigate its predicament in two ways.

On the supply side, the BMC closed its abattoirs to farmers and suspended its Direct Cattle Purchase Program. On the demand side, the BMC was forced to dump its surplus on the local market eroding cattle prices and partially displacing farmers as the primary suppliers to local butcheries. Botswana farmers who had been locked out of the BMC and squeezed out of the domestic butchery market sat by helplessly as their cash flow dried up and the value of their cattle plummeted.

The EU and FAO documents passed to the Sunday Standard reveal that the EU’s unprecedented delisting of BMC’s export abattoirs and the consequential damage to the Botswana beef industry were foreseeable and preventable.

Designated by the EU as Botswana’s “Central Competent Authority” (CCA), DVS is entrusted by the EU with the responsibility of guaranteeing that meat exported to the EU market meets standards for animal health, identification, movement control and traceability and for abattoir and meat hygiene.

The purpose of EU standards is to protect European livestock from endemic African cattle diseases such as Foot & Mouth (FMD), Contagious Bovine Pleuro-Pneumonia (CBPP) and Bovine Spongiform Encephalopathy (BSE) and to protect EU consumers from the related variant Creutzfeldt-Jakob Disease (vCJD) and from food contamination by potentially fatal bacteria such as Escherichia coli (E. coli) and Salmonella.

In its capacity as CCA, DVS is responsible for auditing and enforcing BMC compliance with EU standards on abattoir and meat hygiene and if compliant, for renewing BMC abattoir annual EU Export Licences which are a prerequisite for EU listing. Oddly, DVS is also responsible for both auditing and enforcing compliance with EU animal identification, movement control and traceability standards as the operator of the Livestock Trace-back and Identification System (LITS).

Finally, DVS is responsible for issuing EU Export Certificates in which it must attest to compliance with the above EU standards. [The EU Directive 96-93-EC on the principles of the certification can be downloaded at:
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:31996L0093:EN:HTML]

Periodically, the Food and Veterinary Office of the EU’s Health and Consumers Directorate-General sends Veterinary Inspection Missions to Botswana to audit compliance and certification.

At the conclusion of each Inspection Mission, the EU briefs DVS on its preliminary findings followed by an EU Draft Report with recommendations to correct compliance any deficiencies in the form of a proposed action plan. DVS then has the opportunity to comment on the draft report and proposed action plan. The report and agreed action plan are then finalised and transparently posted on the EU’s website. EU Veterinary Inspection Reports dating back to 1999 can be downloaded at: http://ec.europa.eu/food/fvo/ir_search_en.cfm

After completing its Veterinary Inspection audit in January 2011, the EU briefed DVS on numerous compliance deficiencies which DVS knew were serious enough to warrant the EU taking the extreme step of delisting BMC’s two export abattoirs.

This would have forced DVS to undergo a rigorous EU relisting application process which DVS knew would be problematic given the nature and extent of its non-compliance. DVS’ responded by pre-emptively “suspending” its issuance of EU Export Certificates in the hope that it could unilaterally resume issuing EU Export Certificates once the deficiencies had been corrected so that the decision to resume exports would lie with the DVS and not the EU. But it was not to be.
In the Final Report, No. 2011-6119, issued on 20 May 2011 of their January 2011 audit, [which can be downloaded at http://ec.europa.eu/food/fvo/rep_details_en.cfm?rep_id=2667], the EU Veterinary inspectors found that DVS had failed in its role as CCA in three ways. DVS had failed to enforce BMC compliance with EU plant and meat hygiene standards.

DVS itself had failed to comply with EU cattle identification, movement control and traceability standards which is evident from the FAO’s January 2010 Review of the Botswana LITS which found that the bolus traceability system was in a state of systemic failure: “The LlTS has largely failed to meet the expectations of both the Government of Botswana and the beef sector.”

But most alarmingly, DVS had failed to maintain the integrity of the EU export certification system by renewing the annual EU export license of BMC’s Lobatse cannery when DVS knew the cannery was not EU compliant and by falsely attesting in EU Export Certificates to overall compliance with EU standards when DVS knew that neither the BMC nor DVS were compliant. The gravity of the findings caused the EU to write a follow-up letter dated 08 March 2011 to DVS Director Dr. Phillemon-Motsu in which the EU stated that the credibility of EU Export Certificates issued by DVS, and by necessary implication, the credibility of DVS itself, had been called into question.

In other words, the trust that the EU had placed in DVS as CCA to guarantee compliance with EU standards, which in effect is the basis for BMC’s ongoing access to the EU market, had been broken: It is understood that DVS veterinary officers who resisted falsely attesting to compliance in EU Export Certificates were coerced into doing so by their superiors under threat of being reported to the Minister contrary to EU Directive 96-93-EC which requires that certifying veterinary officers must be completely impartial to maintain the integrity of the EU certification system.

Given the serious nature and extent of DVS’ compliance deficiencies, the EU rejected DVS’ intention to simply suspend issuing EU Export Certificates and demanded that DVS immediately requests the EU to delist BMC’s two export abattoirs failing which the EU would delist them on its own initiative: “We welcome the fact that the competent authority (DVS) has stopped issuing certificates for the meat produced in the two establishments (abattoirs) in Lobatse and Francistown.

In accordance with our administrative procedures, we expect your formal request to remove the entries for those establishments from our EU list until both sides are satisfied that they comply with EU requirements. In case our services do not receive such request within 14 days of date of this letter, the Commission will remove those establishments from the EU list on its own initiative.”

In response to the delisting, the Minister of Agriculture, Christian de Graaf, told Parliament on 31 March 2011: ”We subsequently requested the European Commission to temporarily suspend our export abattoirs from the EU list of approved facilities until we have satisfactorily addressed deficiencies observed during the inspection – this is standard practice. It will take us approximately six months to address these deficiencies.”

The Minister’s statement was misleading on three counts.

Firstly, abattoirs cannot be “temporarily suspended” from the EU list of approved abattoirs. They can only be delisted by the EU until such time as the DVS applies for them to be relisted subject to the EU being satisfied that all its requirements for listing are met.

In other words, DVS had no choice but to request that the EU delists BMC’s two export abattoirs failing which the EU would have unilaterally delisted them.

Secondly, the statement that deficiencies “observed during the inspection” suggested that these deficiencies had only been brought to DVS’ attention for the first time during the EU’s January 2011 Veterinary Inspection. In fact most such deficiencies had been known to the DVS for years as EU Inspection Reports some going back to 1999 and the 2010 FAO Report on the LITS confirm.
Thirdly, the delisting BMC’s two EU export abattoirs to address compliance deficiencies is not, and has never been, “standard practice”. To protect the interests of Botswana cattle producers, the EU has historically accommodated DVS’ ongoing compliance deficiencies without resorting to delisting.
In January, however, DVS’ continued failure to enforce compliance and to fully implement agreed action plan items to correct long outstanding compliance deficiencies was seen as a serious potential health and safety risk for EU cattle and consumers.

But the decisive factor was likely the EU’s concern over DVS having compromised the integrity of the EU Export Certification system, and its own credibility, by renewing the annual EU export licence for the BMC’s Lobatse cannery which DVS knew was not EU compliant, and by issuing EU Export Certificates in which DVS falsely attested to full EU compliance knowing that neither the BMC nor DVS were in compliance.

At a recent cattle producers meeting at Sebele attended by the Sunday Standard, the MOA PS attributed Botswana’s catastrophic loss of the EU market to the lack of PhDs in Botswana “who can teach us about certification”.

The implication of his alarming admission was that without PhDs, DVS does not have the capacity to understand or to carry out its CCA responsibilities of enforcing compliance with EU standards. It also begged the question as to why PhDs would be needed to teach DVS that falsely attesting to compliance in EU Export Certificates was wrong.

The PS’ apparently self-serving comments would have done little to instil EU’s confidence in the DVS.

When asked for comment, Philip Fischer LLB, Co-Chairman of the Botswana Beef Value Chain Project (BBVCP), stated: “The deficiencies identified by the EU in its Final Report must be resolved as a matter of urgency to regain access to the EU market. The public/private BBVCP is the forum for stakeholders and experts to scientifically examine all issues “from farm to fork”, including EU compliance, to assess how each impacts on the efficiency of the Botswana beef value chain as a whole and to make recommendations on how optimize the efficiency of Botswana’s beef value chain to achieve export competitiveness.

For example, I would strongly advocate for replacing the hopelessly dysfunctional bolus system with a farmer administered ear tag system. And in light of the disastrous consequences of DVS acting both as player and referee on traceability, I would advocate for moving the LITS out of DVS and into an independent non-profit public/private entity like Australia’s Meat and Livestock Australia (MLA) http://www.mla.com.au/Meat-safety-and-traceability which DVS would audit on an arm’s length basis.

The Final Report of the EU’s 2011 Veterinary Inspection audit, which can be downloaded at: http://ec.europa.eu/food/fvo/rep_details_en.cfm?rep_id=2667, paints a grim picture of DVS as the “Central Incompetent Authority” which has persistently failed to perform its statutory duty to protect Botswana’s access to the lucrative EU beef market.

The conclusions reached by the EU Inspectors in their Final Report did not mince words: “The principles of certification for public and animal health attestation as laid down in the model certificate “BOV” in part 2 of Annex II to Regulation (EU) 206/2010 are not met at present.
The establishments listed were not in compliance with the relevant EU requirements. This was also clearly stated in the last CA/CCA audit reports (i.e. DVS’ own internal audit reports). Currently, Botswana is not able to provide guarantees to meet the relevant requirements of the BOV export certificate as laid down in Commission Regulation (EU) No 206/2010. Deficiencies are mainly related to holding registration, animal identification and registration and movement controls. There is currently no system in place to guarantee the 40/90 day residence requirement for cattle eligible for slaughter to the EU.

The establishments listed for export of beef and meat products (BMC abattoirs) were not meeting the relevant EU requirements for at least several months. The CCA, aware of this fact, failed to enforce compliance and was late in suspending export to the EU.”

The next article in this series on the Botswana beef industry will take a more detailed look at the specific deficiencies identified in the EU Inspection Report No. 2011-6119 and the January 2010 FAO Report on the LITS and the recommendations made to address such deficiencies.

RELATED STORIES

Read this week's paper