Abstract:
A recent outbreak of Rift Valley fever in East Africa has led to an export ban by Saudi
Arabia and other Gulf countries on livestock products from Ethiopia. An evaluation of the
costs of the ban on Ethiopia’s main exporting region (Somali) and their distribution among
different types of households, producers and traders is conducted using a standard
Computable General Equilibrium (CGE) model. Investment strategies to regain access to
the Gulf market and reduce the probability o f future bans ire also evaluated. Results show
that Somali Region’s GDP is reduced by 25% as a consequence of the ban. In addition,
poor and better off producers experience total losses in value added of around 50% o f their
respective levels in a normal year. The evaluation of an animal health programme in the
Somali Region to minimise the impact of future bans shows that its implementation is
feasible and justifies further analysis focusing in the main factors driving the results.
However, results o f the analysis of different alternatives to charge producers for the
equivalent amount of the cost of the programme show that distortions introduced by taxes
and increased transaction costs affect the viabiliry of the programme. Among these
alternatives, increasing taxes on livestock sales offers the best prospect as the way to
implement the health certification plan in the Somali Region given that it has pro-poor
redistribution effects.
