WTO is falling into the growing chasm between rich and poor nations



June 18, 2022

WTO is falling into the growing chasm between rich and poor nations
Delegates attend the closing session of a World Trade Organization Ministerial Conference in Geneva on June 17, 2022. (AFP)

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As expected, the 12th Ministerial Conference of the World Trade Organization, which took place at its headquarters in Geneva last week, failed to reach a consensus on any key issues. Even though the meeting was extended by more than a day, at the time of writing the chance of any meaningful agreement seemed unlikely.

Before the meeting began, after a delay of more than a year as a result of the COVID-19 pandemic, there were huge expectations among both developed and developing nations.

The developed world was looking to steamroll through the meeting and reach agreements on issues of importance to it, most notably on patents, agriculture and fisheries.

Unsurprisingly, the agenda of rich countries is driven by vested business interests. The issue of patents has long been high on that agenda, in particular a desire to force the developing world, which has come to rely on cheap, generic medicines produced by pharmaceutical giants in countries such as India, to instead buy drugs made by Western “Big Pharma” firms at eye-popping prices that even consumers in the West consider extortionate.

For the needy citizens of poor countries, already on the verge of bankruptcy due to the effects of the COVID-19 pandemic, these drugs would be entirely out of their financial reach unless subsidized by their governments, which do not have money to do so.
Beyond the price of medicines, another key challenge for poorer nations, as witnessed during the pandemic, is the issue of access to them. As soon as the first vaccines were developed — by Big Pharma companies generously funded by Western governments, obviously — rich countries bought up massive supplies, often 10 times more than they needed, even amid pleas by the World Health Organization and civil society groups to at least consider the need for vaccine equity during the unprecedented health crisis the world was facing.

The pleas failed to move either the pharma giants or the rich nations, however. Even now, only a fraction of the populations of poor nations in Africa and elsewhere in the world have been vaccinated. In some rich nations, meanwhile, residents have been vaccinated four or even five times.

This vaccine inequity was one of the most hotly debated topics at the WTO conference. Poor and middle-income countries ought to have learned the lessons of the past two years that they will be abandoned at the first opportunity if they rely on the West for supplies of medicines. Therefore they need to ensure that any agreement on patents protects their rights to essential medicines, as is the case currently under the provisions of the TRIPS accord — the Agreement on Trade-Related Aspects of Intellectual Property Rights, which was signed by members of the WTO in 1994.

But patents are not only required by Western nations for promoting the interests of their pharma firms, they are also very handy in another sector in which the West wants the developing world to sacrifice its interests and follow rules set by wealthy nations.
Agricultural patents have become a major challenge for farmers in poor countries as they affect traditional farming methods.

Traditionally, farmers save some seeds from their harvest and use them to sow the next crop. However, the West wants them to adopt its method, which would mean that each season the farmers must buy the seeds they need from the Western firms that hold the patents for them. If farmers in poor nations are forced to adopt this practice, they might find themselves unable to afford the seeds, as many already struggle to make ends meet.

It is time for the developing world to stand firm and, before signing on to any other agreements, ensure that Western nations fully implement the promises they made at the founding of the WTO.

Ranvir S. Nayar

There are other issues beyond patents. Rich countries also have agriculture subsidies in their sights. Hilariously, wealthy nations that spend something in the order of $55 billion to $60 billion a year to support a few thousand farmers, who account for about 1 or 2 percent of their populations, have a big problem with poor countries that spend a fraction of this amount on support for much greater numbers of farmers, who can account for up to 75 or 80 percent of their total populations.

For more than a decade, rich countries have been crying themselves hoarse over these relatively tiny amounts of per capita subsidies that developing nations offer their farmers. Meanwhile, the EU in the past decade has rebranded the direct farm subsidies it offers, notably though the Common Agricultural Policy, as initiatives to “beautify” rural areas, “preserve ecology” or “landscape” the countryside. But to paraphrase Shakespeare, “What’s in a name?” A subsidy is a subsidy.

Another entirely hypocritical stance adopted by rich countries relates to the issue of “overfishing” and fishing subsidies. They have been targeting developing nations, almost all of which are in Asia and Africa, over the subsidies governments provide to fishermen.

The story here is similar to the one affecting agriculture. Yes, overfishing is a serious concern and needs to be curbed immediately and ruthlessly. But how do we define “overfishing?” Is it when fishing boats from rich countries, notably the US and those in Europe, travel thousands of nautical miles, even venturing close to the poles, for their catches? Is it when per capita fish production is several times higher in rich countries than in poor countries? Or is it when France and the UK get into an ugly spat that almost derails Brexit negotiations as both sides attempt to secure powerful fishing rights for their few thousand fish farmers?
Indeed, as is the case with farming, fisheries are major employers in the developing world, with Asia and Africa together home to 56 million of the 59 million fish farmers around the world. Europe counts only 402,000 people as being employed in its fishing industry.

Yes, Asian and African nations record higher catches but they are working in areas that still have large fish stocks, unlike the Europeans or the US, who have not only exhausted stocks in their own waters and are also fighting over what little remain, as evidenced by frequent disputes within the EU about fishing rights, they are now plundering from the rest of the world.

Another major issue is an overall reform of the WTO itself, as the global trade regulator has been rendered ineffective as a result of several flaws. The most prominent issue is its basic model of working by consensus, which is well-nigh impossible as it now counts as members more than 160 countries, each with its own interests to protect. Any agreement, therefore, can be overruled by any member.

A second challenge is its dispute-resolution mechanism; it has been rendered useless by the US, which has blocked the appointment of judges to appellate panels.

But the most important task for the members of the WTO and its secretariat is to ensure that it keeps the promise made at the founding of the organization, more than two decades ago, that there would be a complete and comprehensive focus on the issues affecting developing countries, most notably through the Doha Development Round.

That solemn promise has been discarded by rich countries. It is time for the developing world to stand firm and, before signing on to any other agreements, ensure that Western nations fully implement the promises they made at the founding of the WTO.
Leaders in the developing world must remember that only by standing firm in the face of pressures from the West can poor nations protect their interests, not only now, but for many generations to come.

• Ranvir S. Nayar is managing editor of Media India Group.

Disclaimer: Views expressed by writers in this section are their own and do not necessarily reflect Arab News’ point of view

source https://www.arabnews.com/node/2106041

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