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An Economic Analysis of Hazard Analysis Critical Control Point-Based Risk Management Programme in the New Zealand Meat Industry

The replacement of the Meat Act 1981 by the Animal Products Act 1999 opened a new era for food safety management in New Zealand. Administering food legislation is now the sole responsibility of the New Zealand Food Safety Authority instead of being shared between the Ministry of Agriculture and Forestry and the Ministry of Health as previously. At the core of the legislative change is the requirement for Risk Management Programmes (RMP). Every single animal primary processing business is required to have an RMP for each type of product. An RMP is required to embrace the principles of Hazard Analysis and Critical Control Point (HACCP). While there have been some studies considering the implementation of HACCP in food businesses worldwide, there has not been any study focusing on HACCP adoption in New Zealand. The mandating of RMP has also made the implementation process more complex. On the other hand, it also brings new experience in terms of food safety management. This thesis examines the implementation process of HACCP/RMP in New Zealand. It also explores the interaction between food safety management and international competitiveness through an economic analysis of the impacts of the program on a New Zealand food processing industry. The meat industry was chosen as a case study as it is one of the first industries that had to comply with the first deadline of the implementation (July 2003). Also, being a significant export-oriented industry of New Zealand, the meat industry provides an ideal case for the purpose of this study. The thesis consists of four parts. Part I presents an introduction to the study including a review of international and national food safety issues, the relationship between food safety and trade and international competitiveness, and the HACCP economic literature. This background helps to shape the research objectives and methodology as described in Chapter 3. Chapter 4 discusses the design of the survey to collect plant experience regarding the implementation of HACCP/RMP in New Zealand. Part II analyses the experiences within the New Zealand meat industry regarding the implementation of HACCP/RMP. It discusses plant motivations to adopt the program and the implementation issues they are facing. Plant observations on the costs and benefits of the implementation are reported. Further, data gathered from the survey are used in a non-parametric analysis of the influences of the plant characteristics on the HACCP/RMP implementation process. The analysis provides implications for HACCP/RMP policy design. Part III presents the modelling techniques to quantify the costs and benefits of HACCP/RMP implementation. In Chapter 8, a quality-adjusted cost function is used to estimate the change in variable cost of production due to HACCP/RMP. It shows that this type of cost can make up a significant proportion of the total implementation cost. In Chapter 9, an export model is employed to analyse the impact of HACCP/RMP on meat industry export performance. The results show that the programme can bring a positive impact on exports. However, the magnitude of the impact depends on the status of existing food safety management before HACCP/RMP implementation. In Chapter 10, the Global Trade Analysis Project (GTAP) model is used to simulate the scenarios where market accesses to significant export destinations are lost when HACCP/RMP is not adopted. The estimated costs of these losses signal the potential benefits of HACCP/RMP. The research results show that HACCP/RMP can deliver a net benefit to the New Zealand meat industry. The thesis concludes with implications for policy design and future research directions. It signifies that the research findings, in addition to reporting an investigation into HACCP/RMP implementation process in New Zealand, provide an important foundation for future research on food safety and international competitiveness.
Type of thesis
Cao, K. Q. T. T. (2007). An Economic Analysis of Hazard Analysis Critical Control Point-Based Risk Management Programme in the New Zealand Meat Industry (Thesis, Doctor of Philosophy (PhD)). The University of Waikato, Hamilton, New Zealand. Retrieved from https://hdl.handle.net/10289/2526
The University of Waikato
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