This paper analyzes firm-level response to the presence or absence
of economic incentives from EU HACCP certification with
implications for the sustainability of food safety systems in a
developing country. Using the Philippine seafood industry, we
present evidence regarding costs and benefits from continued or
discontinued EU HACCP certification.
Results indicate statistically significant differences between
certified and de-certified firms for a majority of realized benefit
and difficulty of adoption categories. While both certified and
de-certified firms reported that output prices in existing markets
did not increase after certification and while realized changes in
border rejection rates were mixed, a majority of the certified firms
did report increases in sales – mainly as a result of their capturing
new markets – and reduction in product wastage. Some certified
firms were able to enter the EU and US markets and take advantage
of higher prices, but these benefits were not realized by de-certified
firms. Many firms, especially de-certified processors, reported
difficulties in procuring high quality and safe raw materials and in
controlling the flow of inputs. De-certified firms reported that due
to budget constraints and fear of not being able to recoup increasing
costs of compliance, they discontinued certification.