TWN Info Service on WTO and Trade Issues (Jun13/04)
7 June 2013
Third World Network

Please Stop Bullying the World's Poorest Countries
By Matthew Kavanagh

This week, the Obama administration's trade agenda hit a bit of snag as the nominee to be lead trade negotiator was challenged over holding a half million dollars in offshore accounts. But as the President prepares to head for Africa this month, that's largely a distraction from a much bigger fight that should be more in the news: the U.S. bullying of least developed countries over intellectual property rules.

In a move that has been roundly criticized by everyone from Doctors Without Borders to the world's librarians and the U.S. technology industry, the Obama administration has taken the position that least developed countries must implement World Trade Organization rules on intellectual property within the next five years. Haiti, Bangladesh, Lestotho, and other Least Developed Countries (LDCs) have proposed an alternative: let the poorest countries in the world focus on getting medicines to their people, making textbooks available, and getting technologies to mitigate the effects of climate change instead of creating patent offices and enforcing the copyrights of multinational corporations. Their proposal simply suggests least developed countries should implement WTO rules when they are no longer officially "least developed." Remember these are the poorest countries in the world -- not rising powers like India or South Africa -- countries classified by the UN as facing the most dire poverty. But U.S. negotiators have rejected that and are strong-arming countries instead.

For those who (like most of the world) have not been following the WTO recently as it has seemed to fade into irrelevance, a bit of background: When the WTO agreement was signed, the members agreed that LDCs would not have to implement the Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement for a period of 10 years, which was extended for another 7 ฝ years, but is now set to expire at the end of the month.

There is literally no clear evidence that implementing a strong patent system helps poor countries. That's why the U.S. refused to grant patents on British technology when we were a developing country and needed to build up our industrial base. Today, LDCs are in exactly the same position, but the U.S. is trying to foreclose the route that most countries in the world have taken to prosperity. The promise in 1994 was that rich countries would help LDCs to develop through transferring technology and help in their development -- so that they would reach a level of prosperity that might enable them to benefit from intellectual property rules. But it never happened -- today LDCs are largely falling further and further behind the wealthy world.

LDCs face massive development challenges: More than half of the LDC population lives on less than $1.25 per day; adult literacy rate in LDCs is on average at 60.7%; only about 5 out of 100 have access to the worldwide web. In fact, more than half of the LDC population do not have access to electricity, water or sanitation facilities. LDCs are also dealing with natural disasters from severe droughts to earthquakes and tsunamis along with political instability.

Yet these are the countries that the Obama administration wants to focus on implementing intellectual property rules?

There are important reasons that LDCs should not enact these outlandish rules on IP. Not only is there no evidence it will help them grow, the costs are incredibly high. Just to name a few areas of concern, WTO rules would likely:

  • Make life saving medicines too expensive: LDCs, by definition, face substantial health problems, but TRIPS IP rules drive up the price of key medicines by allowing them to be patented. Life-saving technology gets put out of the reach of patients and national health programs.
  • Condemn students to outdated books and software: Both the distribution and translation of important books -- even out of date ones -- are routinely blocked by copyright rules. LDC education budgets, though, can rarely afford new bulk purchase of copyrighted books, a reasonable selection of academic journals for universities, or licensed copies of software.
  • Undermine farming & food systems: As our Supreme Court showed last month, IP can hinder traditional farming practices by preventing free exchange of IP-protected seeds and varietals that will be increasingly essential in places facing soil depletion and food insecurity.
  • Make it impossible to adapt green technologies to fit tropical and low-resource climates: Is it illegal for Bangladesh, the most climate insecure country in the world due to sea-level rise and river flooding, to adapt Israeli-designed water filtration systems to work in a low-resource, tropical setting? Without permission of the multiple-patent holders it could be under TRIPS.

What makes this especially cynical is that, when the WTO rules were negotiated, the LDCs were promised this would not happen. Anticipating that it might take some countries a long time to reach prosperity (as it did for the U.S.), the TRIPS Agreement (Article 66.1) says that the Least Developed Countries "SHALL" be granted an extensions if they submit a "duly motivated request," which they did last November. But instead of granting that extension without conditions, the U.S, is extracting concessions.

Can the U.S. win this negotiating round? Of course -- the most powerful country in the world vs. the weakest. But should it? No.

Members of the U.S. Congress have called on the Administration to respect the rules of the game and support a full extension--not just a few years. Civil society groups representing millions agree. UN agencies do too.

The only ones who do not, it seems, are President Obama's diplomats in Geneva. U.S. negotiators, it seems, do not know when its no longer ethical to play hardball.