American Pressure Tactics At WTO
Monday, 13 January 2003


American Pressure Tactics At WTO 



 It appears that the Doha round has been reduced to a big question mark at least as far as the agreement on trade-related intellectual property rights (Trips) is concerned. Para one of the Trips agreement adopted on 14th Nov 2001 at Doha states, "We recognise the gravity of the public health problems afflicting many developing and least-developed countries, especially those resulting from HIV/AIDS, tuberculosis, malaria and other epidemics"?.


Post Doha, the two words 'other epidemics' however, have grown up to be an imaginary monster, prompting US pharma majors to lobby for diluting the said clause at the World Trade Organisation (WTO) before its December 2002 deadline. Though the chairman of the council for Trips, through a draft decision to the WTO on 16th December 2002 stuck to the stand taken at the Doha Declaration Round (DDR), the mighty US refused to budge. A major Trips issue therefore has been stalled.

Though the growing isolation has forced Robert Zoellick, America's trade representative to put up an ambitious proposal of reducing all tariffs to below 8 per cent by 2010 and eliminating them by 2015. The proposal, which excludes farm goods, lacks conviction (both industry and agriculture being the very basis of a poor country's economy), and fails to cut ice with the European Commission which has termed it as unrealistic.

Besides Trips and public healthcare, negotiations on special and differential treatment and implementation issues, targeted to be completed by 31 December 2002, have not been achieved. There is also a growing perception that for the DDR to be successful, developed countries would have to rein in their ambitions, while the developing ones would need to move with a pragmatic approach. As of now, it looks to be a pipe dream.

In a nutshell, the developed world aspires to penetrate into the steadily growing markets of the developing ones and is pushing hard for lower tariffs and duty. But at the same time, it fears giving access to the third world countries and protects its industry through stringent environment laws and whatever other means it takes. For example, no developing country can push even a grain into countries like Australia, New Zealand etc. US have too been blocking foreign steel using the infamous anti-dumping route.

There is little investment coming through the foreign direct investment route. And portfolio investment has left behind deep scars in many developing nations. Poor countries therefore have less to gain and more to loose if they were to open their borders. Politically too, it would prove to be near hara-kiri for any Government that stifles its industry. A stalemate therefore is in the offing with each country firmly holding on to its position. The next round at Cancun, Mexico in September 2003 is bound to carry the huge burden of an unfinished agenda. 

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