Greetings from London, just like the protagonist of a movie In Bruges, The African editor of the British “Financial Times” found himself in trouble, basically unable to travel to and from the continent he intended to cover. Appropriately, the subject of today’s post, the World Trade Organization’s Covid-19 intellectual property exemption, has also fallen into a similar state of suspended animation.

Therefore, in order to subtly break the deadlock, Trade Secrets adopted a different strategy. Today we will mainly look at this issue from the perspective of South Africa and India, rather than analyzing the transatlantic debate on intellectual property exemptions.

There was also major trade news overnight, and the United States and the European Union were preparing to sign an agreement to resolve the 17-year-old dispute between Boeing and Airbus.Expected More about this In tomorrow’s newsletter.

Concession waters After the two parties reached a broad agreement on the transaction, assess the trade links between the UK and Australia.

According to South Africa, what problems the IP exemption will solve

South Africa has been here before.

As early as 2001, the author who was a pharmaceutical reporter at the Financial Times in the United Kingdom happened to spend a historic day in Pretoria, when the pharmaceutical company abandoned its lawsuit against the South African government for obtaining cheap HIV drugs. Pretoria maintains its right to respond to the AIDS pandemic by overriding the intellectual property protection of AIDS drugs. Although AIDS has caused about 35 million deaths, it has never been officially classified as a pandemic. Mainly, it hopes to obtain the right to import cheap generic antiretroviral drugs that have saved lives in the West but are too expensive for most people in Africa where the pandemic is raging.

Xolelwa Mlumbi-Peter, South Africa’s ambassador to the World Trade Organization, said that it was this experience that convinced her government and the Indian government to start pushing for similar patent exemptions for the Covid-19 vaccine and other coronavirus-related medical interventions last year. It doesn’t want to be like this. HIV drugs wait 10 years to get a vaccine. “We know that once there is a vaccine, there will be a battle,” she told Trade Secrets. “Although we appreciate that intellectual property has indeed made a very good contribution to research and innovation, we are also very careful… We should use intellectual property not only for the benefit of intellectual property holders, but also for the benefit of society.”

The initial proposal made little progress until the United States chose to support the abandonment of vaccine intellectual property rights, if not all Covid-19 medical interventions. This move by the new U.S. trade representative Catherine Tay shocked the trade community.

It is expected that the support of the United States will lead South Africa and India to draft a reduced version of their original proposal. However the critics (Including us) Argued that it is still too broad to gain widespread support in the WTO.With the U.S. Seemingly reluctant Intensify the presentation of your own text and propose a more limited version. It is expected that any progress in giving up Covid-related intellectual property rights, vaccines or any other aspects will be slow.

At the same time, the pharmaceutical industry Postpone Opposition to the view that intellectual property protection is the main obstacle to shooting in developing countries. A complex supply chain means that manufacturers need to purchase dozens of inputs from multiple countries/regions. This is a logistics nightmare that cannot be solved by abandoning the IP magic wand. (moan.)

Mlumbi-Peter said that South Africa is fully aware that intellectual property rights are not the only obstacle to improving vaccine production. Voluntary licensing, technology transfer, clinical data sharing, and trade secrets can all play a role in what she calls a toolkit to fight the pandemic. But South Africa denied some manufacturers’ assertions that intellectual property rights do not have a substantial barrier to vaccine production.

As early as the late 1990s, pharmaceutical companies often argued that patenting antiretroviral drugs was not a major obstacle to AIDS treatment, which may remind people of similar denials. They believe that even if HIV drugs are free, Africa lacks the infrastructure or knowledge to use them effectively. This turned out to be wrong, although the problem at the time was a cost issue, not a supply restriction that hindered the distribution of vaccine in 2021.

Despite this, South Africa stated that potential vaccine manufacturers in Bangladesh, Canada, Denmark, India and South Africa have all been restricted due to the threat of prosecution for infringement of intellectual property rights. “This is the focus of intellectual property protection, because it grants monopoly rights. If these monopoly rights are violated, the right holders can accept it,” Mlumbi-Peter said. “So the threat is there, and that’s why intellectual property is an obstacle.”

She also stated that they accepted criticism that the requested exceptions were too broad. In response to European opposition, they proposed a revised text that states that the exemption should be temporary and only apply to diagnoses and treatments specifically related to the Covid pandemic. She said that many countries have received at least partial guarantees and are ready to negotiate on this basis.

If you give up intellectual property rights, African manufacturers are preparing to take advantage of this advantage. The African continent produces only 1% of the vaccines it consumes every year. At a meeting of the African Centers for Disease Control and Prevention in April, delegates formulated a plan to increase this proportion to 60% by 2040.

Three potential COVID-19 vaccine producing countries have surfaced: South Africa, Aspen Pharmacare has prepared to fill and complete 300 million doses of Johnson & Johnson vaccine this year; Senegal Pasteur Institute produces yellow fever vaccines and hopes to produce COVID-19 vaccines in 2022 ; And Rwanda, a country located in central Africa, has strong manufacturing ambitions and matching industrial policies. BioNTech announced its plans to enter Africa last week, aiming to establish mRNA vaccine production facilities on the African continent.

Some of them may sound far-fetched. For critics, the demand for vaccine exemptions is more like a strategy aimed at industry concessions and cooperation, rather than a serious plan to change the situation in which Africa is almost entirely dependent on imports to provide vaccine supplies. For purists, it does not matter whether the African vaccine is produced in India, Malaysia or Malawi.

However, it is worth remembering that in 2001, despite the then President Thabo Mbeki’s denial of the link between HIV and AIDS, South Africa still urgently requested a Trips exemption for HIV drugs. What happened in the chaos. If he is right—he is definitely not—antiretroviral drugs are irrelevant.

However, the victory at the Pretoria court proved to be a turning point. Within a few years, the South African government had caught up with scientific and pharmaceutical companies slashing the prices of their HIV drugs. Literally, millions of lives have been saved.

Pretoria must hope to get similar results from its current patent exemption activities.With the Covid vaccination rate in developing countries Terribly low — Nigeria made 1.1 jabs per 100 people, compared to 103.7 in the UK — G7 promised to close the gap that was about to be missed, and so did the rest of us.

Concession waters

UK and Australia have agree On Monday night, the two prime ministers, Boris Johnson and Scott Morrison, had dinner together after the broad terms of the trade agreement.

As shown in the figure below, the two countries are not particularly dependent. However, the deal is significant because it is expected to become a model for other agreements the UK plans to sign after Brexit. If a trade agreement can be signed this year, it will mark the first large-scale bilateral agreement that has been fully negotiated since Britain’s withdrawal from the European Union.

The following is a breakdown of reliance on the Australian export sector, showing that British manufacturers are most closely linked. Most of the concerns of both parties are about what concessions the deal will provide for farmers. Claire Jones

Trade ties

Gideon Rachman has a great reading As a reminder Although bashing the other side may be meaningful to Boris Johnson or French President Emmanuel Macron, the unity of the Western alliance is more Frozen sausage.

Nikkei report ($) Technology supplier Taiwan, Japan with Korea Listed as a “dangerous risk” along with China U.S. National Security, Highlighting that Washington’s desire to strengthen its supply chain may rebound in business in Asia.

Some interesting articles on how to Environmental policy Have an impact on foreign direct investment.To everyone China’s talk about green, Economist ($) notes Due to the influence of Beijing, foreign companies are still delaying investment there Dependence on coal. Japanese Prime Minister Yoshihide Suga promised to stop government support this year Overseas coal power projects Led by domestic companies that have no offsets, his country aligns with its counterparts in the Group of Seven in its opposition to fossil fuels. (Nikkei, $)

political cover Challenges facing the President of the United States Joe Biden When he tried to get more European support Alliance against China. Claire Jones