GM ban could cost region $2.8b, says Australian report

By LIAM DANN and ANNE BESTON

The New Zealand and Australian economies could lose $2.8 billion a year if they do not adopt genetically modified crops, a report says.

The Australian Bureau of Agricultural and Economic Resources (Abare) report sets aside questions of environmental risks.

It looks only at the relative economic gains and losses that GM crop production around the world would bring to the region.

The analysis shows the global gain from worldwide adoption of GM crops could be up to $350 billion a year by 2015.

The report argues that production improvements from the use of GM crops are likely to cause dramatic increases in export output from developing nations and lower the cost of food.

It concludes that if the rest of the world adopts GM crops but Australia and New Zealand do not, the region would lose a combined total of $2.8 billion a year.

Even if the European Union banned GM production, Australasia would still lose $2.1 billion a year if it did not adopt GM, the report says.

Abare deputy executive director Vivek Tulpule said the report did not make any judgments about whether to go down the GM route.

The aim was to assess the economic implications.

"A lot has been written already about the environmental implications," he said.

The report does not address damage GM crops could do to the image of unrelated exports such as dairy and lamb.

In April, New Zealand Government research concluded that although GM could lift farm incomes by 5 per cent, there was risk that the damage to the clean, green image of our exports could cost more.

Federated Farmers GM policy expert Hugh Ritchie said that, so far, there were no GM crops that would offer major benefits to New Zealand.

"We don't grow a lot of canola, soy or cotton," he said.

In the long term, New Zealand risked losing market share if other countries used GM to become more competitive and we did not, he said.

Abare is an independent research organisation funded by the Australian Federal Government's Department of Agriculture.

Pro-GM umbrella group Life Sciences Network said Abare was an independent, reputable economic analysis company.

"The report clearly identifies economic outcomes ... that there will be significant disadvantages in the event New Zealand and Australia fail to adopt this technology," said spokesman Francis Wevers.

It showed failure to adopt GM would cost Europe economically, but the effects outside the European Union would be "minor".

The report supported Life Science's submissions that the economy could be harmed if it did not keep up with biotechnology developments, he said.

Australian Bureau of Agricultural and Economic Resources