NZ Exports Risk Multi-Billion Dollar Hit If GMO Rules Deregulated

New Zealand’s primary sector exports could reduce by $10billion to $20billion annually were genetically modified organisms (GMOs) to be released into the environment, according to a study by New Zealand Institute of Economic Research (NZIER).

The report, commissioned by Organics Aotearoa New Zealand (OANZ) to evaluate the cost of proposed regulatory changes governing gene technology, says that the costs as well as potential benefits of deregulating gene technology need to be carefully considered in considering new regulations.

NZIER study authors Dr Bill Kaye-Blake and Thomas Hughes note that the government’s proposed regulatory changes, as outlined by information from the Ministry of Business, Innovation & Employment (MBIE), do not include a Regulatory Impact Statement, economic assessment or cost-benefit analysis.

The report assesses the value of New Zealand’s current GE-free status, and the value premium this provides to primary sector exporters as well as the tourism sector. It then evaluates the potential costs that could be incurred from the loss of value arising from the release of GMOs into the environment.

The report’s conclusion states that “a discussion of gene technology in New Zealand should include all the economic actors affected and quantitative analysis to understand the impacts.

“The quantitative analysis we have been able to conduct with limited time and resources suggests that the environmental release of GMOs in New Zealand could reduce exports from the primary sector by up to $10billion to $20billion annually,” says the report.

“NZIER understands that gene technology has potential benefits, as outlined by MBIE (2024). As professional economists, we also understand that there is no free lunch. Any assessment of the potential of gene technology should also account for possible costs. We hope this provides a first step in understanding these costs.”

The full report: ‘Potential costs of regulatory changes for gene technology, Economic assessment of an MBIE proposal, NZIER, November 2024’ can be found here.

An OANZ delegation is returning to Wellington in December to meet with decision makers.

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