Policy Implications
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development—as proxied by its credit/GDP ratio—was about three times that of Tanzania. If the latter were to reach the former’s level of financial development, the hazard rate for shrimp exports—a highly risky product as measured by the riskiness index—would go down by 7 percent for Tanzania. That is, the probability of surviving one more year would go up by roughly 7 percent. Depending on the initial hazard rate, this could be a very substantial increase in the survival probability. For instance, with an initial hazard rate of 0.7, the survival rate would jump by 16 percent, from 0.30 to 0.35. Our discussion of the role of technical regulations and standards in chapter 2, in particular in agro-food products, highlighted their potential to disrupt trade flows through sudden regulatory changes or through the arbitrary application of regulations at the border. U.S. food safety regulations, in particular, explicitly allow for discretionary and informal “profiling” in the application of regulations at the border (see Jouanjean, Maur, and Shepherd 2011).
Technical Assistance: Does It Help? In chapter 3 of this report we discussed how the administration of sanitary and phytosanitary (SPS) measures could be a factor in the low survival for African agri-food exports. Recognizing this, the European Union has put in place programs designed to help producers in lowincome countries, in particular African, Caribbean, and Pacific (ACP) countries,3 to cope with those measures. If well designed, such programs have the potential of helping to secure market access for producers who would otherwise have difficulty following, and complying with, the rising tide of sanitary and technical regulations in their EU markets. Recent research by Jaud and Cadot (2011) suggests that, when subjected to rigorous impact evaluation, technical assistance programs may turn out to have less of an impact than expected, as treatment-effect methodologies uncover no significant performance improvement for “treated” firms. In this section, we consider a similar exercise using export survival—rather than export growth—as the performance measure, and find similarly insignificant treatment effects. However, impact-evaluation results should be interpreted very cautiously, for reasons that we will discuss later on in this section. Jaud and Cadot focused on the Pesticide Initiative Program (PIP). Financed by the European Development Fund (EDF) with an overall budget of 34.1 million euros, the PIP started in 2001, initially for a