The economic impacts of foot and mouth disease – What are they, how big are they and where do they occur?

Although a disease of low mortality, the global impact of foot and mouth disease (FMD) is colossal due to the huge numbers of animals affected. This impact can be separated into two components: (1) direct losses due to reduced production and changes in herd structure; and (2) indirect losses caused by costs of FMD control, poor access to markets and limited use of improved production technologies. This paper estimates that annual impact of FMD in terms of visible production losses and vaccination in endemic regions alone amount to between US$6.5 and 21 billion. In addition, outbreaks in FMD free countries and zones cause losses of >US$1.5 billion a year. FMD impacts are not the same throughout the world: FMD is highly contagious and the actions of one farmer affect the risk of FMD occurring on other holdings; thus sizeable externalities are generated. Control therefore requires coordination within and between countries. These externalities imply that FMD control produces a significant amount of public goods, justifying the need for national and international public investment. Equipping poor countries with the tools needed to control FMD will involve the long term development of state veterinary services that in turn will deliver wider benefits to a nation including the control of other livestock diseases.