Trade and industry, Law, Health | Asia, The World

17 August 2022

The COVID-19 pandemic has exacerbated the ongoing crisis of multilateralism, calling into question the credibility of international institutions in responding to public health emergencies, Pallavi Arora and Pragyan Agarwal write.

Multilateral institutions are under ever-increasing scrutiny.

Since the breakout of the global pandemic, a prime target has naturally been the World Health Organization, which came to be perceived as tardy and bureaucratic as it scrambled to respond effectively to such a massive crisis.

But it’s not the only one. The World Trade Organization (WTO) has had to postpone its biennial Ministerial Conference (MC) twice since the start of the COVID-19 pandemic, delaying the adoption of critical trade policies designed to address the pandemic.

Finally, in June, the WTO was able to hold ‘MC-12’. It produced what it called an ‘unprecedented’ package of trade outcomes, but onlookers have had mixed reactions.

While some have lauded the WTO for reaching a consensus on contentious trade policy issues, others have argued that the agreement hasn’t resolved the fundamental differences holding back the organisation.

The pandemic has posed a range of issues for the WTO. Unequal access to COVID-19 vaccines and treatment between developed and developing countries, and intellectual property (IP) monopolies over critical COVID-19 health products have been central concerns. Disruptions in global supply chains have demanded attention too.

Food insecurity also emerged as area of concern, along with rising unemployment and inflation, and declining incomes.

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Travel restrictions have also affected trade, especially by curtailing the cross-border movement of healthcare professionals.

All these issues were on the agenda at MC-12. After intense discussions, the WTO produced a ministerial declaration on its response to the pandemic and future pandemic preparedness, along with a decision on the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).

That decision dealt with the foremost issue occupying the WTO over the last two years – intellectual property monopolies some patent-holders still hold over COVID-19-related technology, including vaccine production technology.

In 2020, India and South Africa’s ambitious proposal to waive IP rights under the TRIPS agreement to facilitate timely access to COVID-19 health products was blocked by members with strong pharmaceutical industry interests.

A diluted compromise that marginally streamlines compulsory licensing regimes – flexibility that is already part of the existing TRIPS framework – was all anyone could achieve in the end.

While the decision is limited to patents on COVID-19 vaccines, within six months, the membership will deliberate on its extension to other diagnostic and therapeutic technologies.

While incomplete, at the very least this outcome reflects a growing consensus among WTO members that the existing TRIPS framework is inadequate to address global-scale crises and may be the first step toward shaping future norms.

More on this: Does it really matter if Trump pulls the US out of the World Trade Organization?

The WTO’s ministerial declaration focused on the other issues affecting world trade in the pandemic era.

Acute supply shortages have disrupted global value chains since the pandemic began. Consequently, some developed countries have sought to prevent developing countries implementing export restrictions during crises.

These countries, including India, have justified export restrictions on COVID-19 health products, saying that they are symptoms of acute supply-side constraints and can prevent potential monopolies.

On this issue, while recognising members’ right to apply export restrictions in response to the pandemic, the declaration clarifies that they must be used only as a measure of ‘last resort’.

On food security, the declaration says it ‘underscores the need for a comprehensive solution’ to tackle this issue, especially for countries that need to import food to meet their needs.

While goods are often first in focus, the pandemic has also massively affected services trade, and the declaration acknowledges this, especially for health care and health technology services. Further, it calls for cooperation on issues like testing requirements, vaccination certificates, and mutual recognition of health documents that affect the supply of health services across borders.

But is this too little too late?

Admittedly, these outcomes are not a set of radical reform proposals that can tackle future public health emergencies. Still, the fact that 164 WTO members could sit around a table and reach some consensus on such contentious issues of global trade governance is reason enough to be optimistic.

If members can translate this momentum into meaningful progress, it may be a win for multilateralism that reaches far beyond the walls of the WTO.

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One Response

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