Contribution to the economic impact assessment of policy options to regulate animal cloning for food production with an economic simulation model

The European Commission is currently evaluating different policy options towards the use of cloning or products derived from cloned animals in the food chain. This study presents a first attempt to quantify the likely effects of different policy scenarios on international trade and EU domestic production. In the context of the Impact Assessment process carried out by the European Commission, the JRC was requested to simulate via a modelling study the economic impacts of selected policy options. Based on a literature review and after considering the specific objectives of this study, the choice was made to perform the analysis employing a Computable General Equilibrium (CGE) model called GLOBE and to focus on the dairy and beef sectors. Different model scenarios were constructed based on combinations of the discussed policy options such as a ban, or traceability and labelling requirements with associated productivity increases arising from the use of the cloning technique. The results indicate that only in the case where trade with countries employing cloning techniques is suspended, is there a noticeable effect on competitiveness. This suspension could be due to express prohibitions or a de facto decision by exporters when traceability and labelling costs increase. Under this scenario, imports drop significantly which is followed by a slight increase in domestic production and prices, especially for beef and cattle.