COVID-19, MC12

WTO: MC12 preparations accelerate amidst TRIPS waiver breakthrough hopes

China has enhanced the prospects of an agreement at next month’s WTO ministerial meeting on a TRIPS waiver for COVID-19 vaccines, by stating that it will not be making use of any flexibilities offered to developing countries on access to patented medicines.

The announcement by China – which self-identifies at the WTO as a developing country – is designed to address some of the concerns of other WTO members over a new plan to grant poorer countries a temporary waiver on intellectual property restrictions for COVID-19 vaccines.

But at the end of a two-day meeting of the WTO’s controlling General Council in Geneva on Monday and Tuesday (9 and 10 May), it is clear that the TRIPS issue is nevertheless continuing to attract controversy.

‘Quad’ paper widely accepted as basis for TRIPS negotiations

Most WTO members have now agreed to use the framework agreement which was collectively worked up by the EU, the US, India and South Africa over recent weeks as a basis for further text-based discussions.

This represents a step forward for the pre-MC12 negotiations, given that, in the words of TRIPS Council chair Lansana Gberie, that paper is now “the only game in town”.

The text of the so-called ‘Quad’ paper – which Geneva negotiators are now prosaically referring to as ‘Paper 688’ – would in essence allow developing countries to authorise production of Covid-related vaccines “without the consent of the rights holder”.

Two alternative footnotes to the agreement are under discussion.

One would encourage developing countries which export vaccines to “opt out” of this decision, while the alternate wording would disapply the terms of the agreement to any developing country which exported more than 10% of vaccine doses in 2021.

China is the only country which meets that latter definition – but Beijing is insisting that the 10% market share footnote be deleted, describing it as “an unreasonable and arbitrary criterion”.

China ‘will not make use’ of TRIPS waiver concession

The Chinese delegation told the General Council that the country would not make use of the TRIPS waiver in any case.

It remains to be seen to what extent this affirmation will reassure countries which are nervous about China’s shaky record on intellectual property issues that the ‘opt-out’ route would be a suitable way to proceed.

A number of developing countries are meanwhile still pushing for the waiver to be expanded to cover therapeutic and diagnostic products as well as vaccines, while the UK and Switzerland are continuing to claim that a TRIPS waiver could undermine innovation in the pharma sector.

The International Federation of Pharmaceutical Manufacturers and Associations said on Tuesday that the waiver proposal had already been overtaken by events, given that at present vaccine supplies “are vastly outstripping demand”.

However, the WTO’s chief spokesperson Keith Rockwell said that the prospect of a deal on a TRIPS waiver at the 12-15 June ministerial had been “greatly elevated” by the latest discussions.

Multiple proposals on trade and health issue

There is less optimism over the parallel negotiations on ‘trade and health’ – a series of proposals which would notably address restrictions on exports of healthcare products.

A text drawn up by New Zealand ambassador David Walker in advance of the scheduled MC12 meeting last November has now been shelved, and Honduras’ ambassador Dacio Castillo has been tasked with pulling together the various proposals into a streamlined text. This will be a big ask, with now less than five weeks to go before MC12 gets under way.

The issue may get drawn together with the food security debate, given the common theme of keeping trade flowing for the common good.

The food crisis provoked by the war in Ukraine has breathed new urgency into the discussions on agriculture and food security – although the only element of the ongoing agriculture negotiations which stands a chance of being tied up at MC12 is the proposal to exempt from export restrictions any food consignments destined for use by the World Food Programme.

This proposal is now supported by all parties except Tanzania and India – the latter presumably holding back consent as leverage to get a more favourable outcome in other areas.

Dedicated round of talks on fisheries subsidies next week

WTO spokesperson Rockwell had earlier sounded more positive about the prospects for an agreement on curbing subsidies to the fisheries sector.

“Some members have now been saying, it’s now or never for an agreement. There is a real willingness to try and get this done,” he told journalists.

The chair of the fisheries negotiations, Colombia’s Santiago Wills, has convened a round of dedicated negotiations on the draft fisheries text next week, in a bid to push the dossier forward.

The text slated for negotiations last November contained 26 pairs of square brackets – but this text does at least remain on the table, and Wills is hoping to generate fresh momentum to get a deal tied up at MC12.

Obstacles to progress on e-commerce, WTO reform

India is taking a defensive position on e-commerce, where a proposal to renew the existing moratorium on duties on digital trade, pending further WTO discussions on the topic, is supported by a large majority.

But India, backed by South Africa and Namibia, are calling for improvements in the definition and scope of what ‘e-commerce’ relates to.

On the question of WTO reform, Rockwell told journalists that all delegations were agreed on the importance of this topic – but he noted wryly that all delegations had a slightly different perception of what this should cover.

Many delegations are pressing for a rapid resolution to allow the Appellate Body to resume its functions. But the US is insisting that WTO processes and institutions should be reviewed holistically, rather than focusing principally on dispute settlement.

The best that can be hoped for at MC12, therefore, appears to be a broad commitment to open talks on the subject – and to define the content of the negotiations as the process continues.

Stocktaking meeting in early June to define ‘status’ of MC12

A broader question as MC12 looms ever larger is the status of the meeting itself, and the scope for ministers to take any major decisions – given the state of war that exists between WTO members Russia and Ukraine.

Rockwell stated that decisions about the format of the meeting, and the ‘deliverables’ coming out from it, could only be taken at a later stage. This, he said, would depend on progress on the various dossiers in the meantime.

A ‘stocktaking’ exercise has been pencilled in for early June, when many trade ministers will be meeting in Paris for an OECD ministerial session.

“This will be the point at which we can assess where we have got to, and what we can deliver,” Rockwell said.

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