What’s at Stake at the WTO?

WTO building in Geneva, Switzerland

November 25, 2021

Too much is at stake at the upcoming 12th ministerial conference (MC12) of the World Trade Organization (WTO), set to take place from November 30 to December 3, in Geneva, Switzerland.

One would think that every global institution, and particularly one whose rules govern trade in vaccines, medicines, and other medical products necessary to end COVID-19, would be doing everything in its power to contribute towards ending this horrendous pandemic.

Unfortunately, we are talking about the WTO, where the protection of billionaires’ intellectual property monopolies, intended to reduce supply and increase prices, are sacrosanct. Developing countries introduced a proposal to waive certain provisions of the WTO’s Agreement on Trade-Related Intellectual Property Rights (TRIPS) in order to ensure vaccines, treatments, diagnostics, and medical products necessary for the treatment and containment of the COVID-19 pandemic are accessible to all. More than a year after its introduction, members have still not agreed to start negotiations on the waiver.

Imagine having the recipe to end a global pandemic that has claimed at least 5 million lives probably closer to 17 million in excess deaths — and refusing to share it, for any reason. The executives of Moderna, Pfizer/BioNTech, and the like clearly believe their billions in stocks are worth more than millions of lives — and they have the WTO to hide behind.

These corporations and their parent states are pushing ahead with a business-as-usual agenda, citing COVID-19 as a justification for their existing proposals to rig the rules of the global economy to further entrench corporate power and profit.

TRIPS Waiver Now! Walker, Walk Away!

The proposal to waive certain provisions of TRIPS in the WTO to resolve COVID-19 has the support of well over 100 countries, numerous former heads of state and Nobel laureates, academics, researchers, EU parliamentarians, members of the US Congress, as well as civil society organizations (CSOs), and multiple trade union federations (ITUC, PSI, and ITF) representing more than 200 million members around the world.

But trade negotiators from the EU, Switzerland, the UK, and Norway — representing the interests of Big Pharma ahead of their own citizens and global public health — have refused for over a year to take the steps identified by the global health community to remove IP barriers in the WTO in order to help resolve the pandemic. The United States announced support in May, but has yet to put the necessary muscle into convincing allies to go along.

Instead, developed countries have invented a diversionary tactic named the “Walker Process” after New Zealand’s ambassador who is leading it. Allegedly facilitating “the WTO’s Response to COVID-19,” this process is designed to try to save the WTO from its increasing illegitimacy. In reality proponents are appropriating the death and suffering of millions from COVID-19 to promote their wish-list of WTO expansion and draw attention away from the WTO’s legacy of failures.

Major international civil society organisations exposed the sham of the so-called “Walker Process” as a cynical scheme to distract from the WTO’s failure to adopt the TRIPS waiver in a letter sent on November 19 to members of the WTO. The letter describes the Walker process as “a deplorable attempt by the WTO to cover up what should be a grave humiliation: its inability to agree to remove key obstacles to resolving the COVID-19 pandemic by waiving intellectual property barriers as per the TRIPS waiver proposal. Millions of people have died because of the WTO’s vaccine apartheid and the IP-driven inequitable access.”

Civil society has issued a Global Call to Action: WTO Waiver now to end the pandemic! Activists who have been pressuring governments all year to agree to the waiver are increasing the pressure in advance of MC12. And with the COVID-19 caseload surging across Europe, people of the Global North and South can be sure: had governments shared the recipe earlier, global vaccine production would have been scaled up by now, and we would not be witnessing a resurging catastrophe at the same scale.

Illegitimate Ministerial

The institution whose rules enforce vaccine apartheid is trying to hold a conference under conditions of vaccine apartheid — without first resolving that apartheid by agreeing to the waiver. Ministers from many WTO members will not be able to attend — even when their biggest economic activities are on the table — becuase of COVID-related travel disruptions. Delegates with certain vaccines will be able to enter the WTO freely, while others will have to queue for regular testing. Many are from countries without access to vaccines, so the health risks — not to mention potential cost of quarantine — may be too great. Given these circumstances, the director-general’s decision to go ahead with this conference is illegitimate. The waiver can be agreed without a ministerial, at a regular general council meeting in Geneva.

That’s why CSOs sent a letter on November 23 calling for the conference to be postponed, and for members to focus fully on agreeing to the waiver. The letter points out that “the WTO claims to be a consensus based organisation. The decision to hold a ministerial when some ministers are unable to attend will ensure that any decisions taken in this context will lack any pretence of legitimacy.”

Even seasoned WTO experts have been taken aback by the increasing repression of civil society at this year’s ministerial. Traditionally, CSOs are allowed four people per delegation at the WTO during ministerials — but the new director-general has limited it to one and abolished the NGO Center. Public health advocates are now being told they cannot even hold signs calling for the waiver, in front of the WTO — in clear violation of their freedom of speech rights.

Biggest Threat: Entrenched Corporatization of the WTO

The WTO has always been driven by corporate interests; of all international agencies, it is the one which most marginalizes the voices of civil society representing all other communities affected by its decisions.

But MC12 represents the most dangerous play for expanded corporate influence over global economic rulemaking since the founding of the WTO 25 years ago. That is because rich countries are pushing to abrogate one of the most fundamental aspects of the WTO — that of multilateralism. Instead, trade ministries of rich countries, heavily influenced by their big business lobbies, are seeking to legitimize new pathways for pro-corporate agreements in the WTO through the so-called Joint Statement Initiatives or JSIs, which are incompatible with the multilateral rules of the WTO.

Pro-corporate governments launched the JSIs as plurilateral negotiations (among coalitions of the willing) after their agendas failed to secure agreement by the membership at the last WTO ministerial, in Buenos Aires in 2017. The three most important plurilaterals share a common underpinning of increased corporate control over the most important aspects of the global economy.

The plurilateral JSI on Digital Trade (pitched as “E-commerce for Development”) would rig the rules of the global digital economy in favor of Big Tech, from whence the idea of such an agreement emerged. The holy grail of Big Tech is the guaranteed right to control the collection and manipulation of the world’s most valuable resource — data — for profit. It is racing to cement in this control through binding international agreements before the world knows its true value, with proposals aiming to secure the rights to transfer and store data wherever in the world it wants to. Communities and countries would be unable to access and use that data for the public good or for digital industrialization strategies that are the only way to ensure shared prosperity from technological progress.

The JSI on Domestic Regulation would restrict how governments can regulate foreign services corporations operating in their countries. “The proposed rules will restrict how governments can perform their public responsibilities, seek to remove discretionary considerations, open national law-making to influence by foreign corporations and other governments, and impose costly and onerous compliance requirements with no guaranteed assistance, while limiting fees that governments can charge,” according to an analysis by law professor Jane Kelsey of the University of Auckland.

The JSI on Investment Facilitation would provide similar benefits to foreign firms wanting to invest in the country, according to the Third World Network. It would also open up a pathway for investing corporations to interfere in the domestic policy making process, anathema to democracy.

While the plurilaterals on Digital Trade and Investment Facilitation are not yet concluded, proponents have finalized the Domestic Regulation rules and are eager to adopt them at MC12. Most legislators, regulators, mayors, and community activists would be scandalized by the implications of these rules — which is why they are happening at the WTO, the most untransparent of all global institutions, under even more secrecy than usual.

WTO Crisis and “Reform” — in the Wrong Direction

It is well known that the WTO has been in crisis for some time. Its dispute settlement function, once considered its crown jewel, has been paralyzed since the United States began blocking the appointment of new appellate body judges some years ago. But the institution has limped on, even without the ability to enforce its own rules.

The graver crisis is that the rules have contributed to the growing trends in inequality, food insecurity, and climate crises. Most countries that have experienced strong economic growth in the 25 years since its inception have done so through integrating trade with China, not by integrating trade with the EU, US or by adhering to the WTO rulebook.

Developed countries have now blocked, for 20 years, the resolution of the development agenda, through which developing countries sought some flexibility from some onerous and constraining WTO rules which have greatly hindered their development.

But corporate boosters never let a good crisis go to waste. They are proposing to launch new talks under the guise of WTO reform that would achieve quite the opposite. In addition to legitimizing the JSIs, their proposals focus on: launching new negotiations on issues of interest to big business; creating new mechanisms to expand the direct influence of the business agenda at the WTO; abandoning forever the development agenda; attacking the ability of developing countries to access flexibilities enshrined in the WTO, without which they never would have agreed to its existence; and expanding the monitoring function of the WTO in a way that would in a way that would further constrain developing countries and LDCs in exercising their development-centered policy. Unfortunately, these positions have only consolidated under the Biden administration.

Like most toxic blight that would not survive in the light of day, these talks are being convened in the shadows, under exclusive, WTO-illegal “green room” processes from which the vast majority of members of the WTO have been excluded. But proponents spin wild claims they could somehow renew the relevance of the WTO.

Agriculture for Food Security — or Agribusiness Profit

Much like stockpiling of masks in case of a pandemic, public stockholding is a best practice among developing countries to ensure food security. These programs involve states purchasing food from poor farmers at minimum prices, and distributing that food through national food security programs as a human right, rather than a political tool. But these programs were not explicitly carved out of WTO in 1995, so they are automatically counted in the category of bad “trade-distorting subsidies”, even if they are not — the food would not have been traded, and the recipients would not have purchased imports otherwise.

The Africa Group, India, and most developing countries favor these policies, and have long made proposals to release them from WTO constraints. There is a mandate from 2013 for a permanent solution to the public stockholding issue by 2017, but the United States, the EU, Japan, Canada, and Australia are still blocking a resolution. They are also blocking proposals to allow poor countries to safeguard farmers’ livelihoods in cases of import surges. Agribusiness exporters don’t care if the poor do not eat unless it profits them.

Big Agribusiness (the corporations that drafted the original Agreement on Agriculture) also oppose such sensible reforms. Instead, they are pushing for proposals at MC12 that would reduce states’ ability to guarantee food security, and give more market power to dominant industries.

Fisheries — to Discipline or Not to Discipline?

Our oceans are being overfished by large capacity fleets that are often highly subsidized. World leaders mandated WTO members to agree to limit such overcapacity and overfishing, as well as illegal, unreported, and unregulated (IUU) fishing in 14.6 of the Sustainable Development Goals (SDGs). But their mandate also recognizes that appropriate and effective special and differential treatment for developing and least developed countries should be an integral part of the WTO fisheries subsidies negotiations.

The Fisheries Subsidies text is touted as the most likely to be conclude at MC12. But the latest Chair’s text would allow the biggest subsidizers to continue without reductions, while the notification requirements for developing countries are too onerous, and the technical support and capacity building provisions are not guaranteed, leaving the livelihoods of small fishers and their families’ nutrition at risk.

It would be positive to have a global deal to discipline fisheries subsidies, but according to the analysis by the Pacific Network on Globalization, “No Deal Is Better Than a Bad Deal!”

Conclusion

The contours of the battle are clear. The best outcome for humanity would be: a full TRIPS waiver, an expansion of development flexibilities, including in fisheries subsidies, and a pro-food security outcome in agriculture.

But this outcome is not favored by pro-corporate governments. A more likely scenario could be that rich governments offer a partial waiver that is too complicated to use, in exchange for steep, binding and permanent concessions on so-called WTO reform, the legitimization of plurilaterals, fisheries subsidies that harm artisanal fisherfolk, and nothing on food security. But India, South Africa, and other countries have been clear: they want a strong waiver to save lives, not a weak waiver to “save” the WTO.

In this scenario, the EU, US, and other countries will rev up the Blame Game, ensuring that media portray India and South Africa as “blocking progress” towards consensus and that it is the EU that is trying to save lives and the WTO (through the “Walker process” and other such fig leaves).

Then, it will be up to civil society to ensure that the world knows the truth, and to live to fight for the waiver — a strong waiver that will help end the pandemic — and the transformation of our global trade system — another day.

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