Investigating the Impact of Sanitary and Phytosanitary measures on Non-Tariff Measure use

While there has been a general reduction in tariffs on trade since the creation of the World Trade Organisation (WTO) in 1995, there has been a rise in the use of Non-tariff Measures (NTM). Three major NTM types are Anti-Dumping Policy (ADP), Countervailing (CV) measures and Sanitary and Phytosanitary (SPS) measures. This paper investigates how the use and possible abuse of SPS measures influences other countries to change their use of NTM in retaliation. It aims to do this by answering the question: what are the responses to SPS measures by opposing countries, in the form of NTM (ADP and CV) use? This involves analysing every SPS measure, from the WTO list of SPS concerns – SPS measures which have been flagged as a potential violation of WTO rules - to investigate the change in NTM use each has caused i.e. the change in the number of NTM after, relative to before the SPS was implemented. This study finds that for 71.3% of SPS measures, there is no observable relationship between SPS and ADP (for CV it is 94.9%). But for the large tranche remaining for ADP measures (28.7%), SPS measures are shown to reduce other countries’ use of ADP measures. Conformity Assessment (CA) SPS measures were found have a stronger effect than Product Characteristic (PC) SPS measures on reducing ADP use. The study also finds that groups of multiple SPS measures have the opposite effect, implementing an extra 1 SPS measure within a short time of the first, increases the response of ADP in return by between 0.409 and 0.925. For the remaining 5% of CV measures, no relationship was found with SPS.