Charting A Trade Route After The MC12

Context: World Trade Organization (WTO)’s 12th Ministerial Conference (MC12) is being held at an important juncture when the global trade scenario is quite upbeat. This is an ideal setting for Trade Ministers to correct iniquitous rules and provisions.

Issues associated with WTO

• Rigid IPR laws and vaccine challenge: IPRs due to Trade-Related Aspects of Intellectual Property Rights (TRIPS) agreement of WTO are formidable barriers to ensuring equitable access to COVID -19 vaccines.
  • Global Pharmaceutical companies have used monopoly rights granted by IPRs to deny developing countries access to technologies and know-how, thus undermining the possibility of vaccine production in low-income countries.
  • Availability of vaccines remains a critical problem in low-income countries even after a year since the first dose of COVID-19 vaccine was administered.
  • Vested interests of developed countries: India and South Africa’s proposal for waiving enforcement of several forms of IPRs on COVID vaccine and related technologies, supported by two-thirds members were opposed by developed countries.
• Completely unbalanced draft on fisheries subsidies: As they do not provide the wherewithal to rein in large-scale commercial fishing that are depleting fish stocks and threatening livelihoods of small fishermen in countries such as India.
• Inconclusive discussion on e-commerce firms: OECD and G-20 members are planning to introduce global minimum taxes on digital companies.
  • Contradiction: As, in WTO, these countries have been investing their negotiating capital to facilitate expansion of e-commerce firms.
  • Inherent bias: The key focus of 1998 e-commerce work programme, “development needs of developing countries”, is entirely missing from current negotiations.
  • Misplaced priorities: On negotiating table are issues relating to liberalisation of goods and services trade, and guarantee for free flow of data across international boundaries.
• Divisions over adoption of investment facilitation agreement: That has reintroduced old agenda of 2001, the Doha Ministerial Declaratione. a work programme on investment, which was opposed by developing countries as
  • That expanded rights of foreign investors through a multilateral investment agreement.
  • Sovereignty concerns: As the agreement ‘s ultimate objective is to bind host governments into a multilaterally agreed commitment to comprehensively protect investor interests.
• Flawed negotiating processes in WTO: Entire process of negotiation is “detrimental to existence of a rule-based multilateral trading system under the WTO”.
  • Non-inclusive: As negotiations are not conducted by mandate given by the entire membership of the WTO transparently.
  • Bias: Agenda of developed world is offered to rest of the members on a “take-it-or-leave-it” basis.

Way forward:

• Revisit trade rules and agree on a work programme for WTO, which can help maintain the momentum in trade growth.
• IPR waiver on products useful for COVID-19 treatment: By doing so, barriers created by IPRs to timely access to affordable medical products could be removed.
  • And, involvement of developing countries in vaccine production will increase affordable vaccines supplies to low-income countries.