Trade
No end to COVID-19 pandemic absent international cooperation
Author: Jeremy Youde, University of Minnesota Duluth
India is in the grips of a massive COVID-19 outbreak, with the total number of cases now numbering more than 24 million sick and more than 250,000 deaths (though the number of COVID-19 deaths is likely significantly higher). The country is setting records for the number of new cases nearly every day. Arundhati Roy, the world-renowned Indian author and activist, has called the situation a ‘crime against humanity’.
The rapid surge of cases in this second wave of COVID-19 has quickly overwhelmed India’s health care system. Medical oxygen, a vital tool for treating patients whose blood oxygen levels are too low, is in such short supply that some hospitals are asking patients to bring their own oxygen with them. Hospitals have even sued the government to force it to devise a plan to supply oxygen. Patients who can’t get a hospital bed are being forced to lie outside because there is no space inside.
Compounding the situation is the sheer lack of vaccines to stop further spread of the virus. In late April, Mumbai, home to roughly 20 million people, had to stop all vaccination campaigns for three days because it had no more vaccines. Though India is the world’s biggest producer of vaccines and has been engaged in an active vaccine diplomacy program, the country is now importing doses of Russia’s Sputnik and the AstraZeneca vaccine, along with the locally-produced Covaxin vaccine, to resume its vaccination program The country was able to resume vaccinations thanks to donations of Russia’s Sputnik vaccine and locally-produced supplies of the AstraZeneca and Covaxin vaccines.
Despite widespread acknowledgement that viruses do not respect borders, India’s devastating experience with COVID-19 calls into question the degree to which the international community is willing to translate idea into practice. Programs like the COVID-19 Vaccine Global Access (COVAX) are supposed to ensure a more equitable distribution of COVID-19 vaccines, but the reality seems instead to reinforce the inequalities around vaccine distribution.
While shipments of the AstraZeneca vaccine from the United States will be helpful, there is more that it could do to ameliorate the shortages in India—and the inequitable access to COVID vaccines more generally. A program like COVAX or donations from the United States can only do so much to resolve structural inequalities that limit access to pharmaceuticals and vaccines; it addresses the immediate issues but not the underlying root causes that give rise to maldistribution in the first place. If world leaders want to make pharmaceuticals more accessible, they need to change the intellectual property rights system governing therapeutic drugs.
Intellectual property rights grant creators the right to control who gets to produce a product and under what conditions through the granting of patents. This control is supposed to reward innovation by allowing creators of intellectual property to reap the rewards from their discoveries.
This might make sense in the case of a car or a computer, but what happens when the people who need access to a drug to protect public health are the very people who lack the money to purchase it? When commerce takes precedence over public health and prevents people from getting the drugs that can protect their own lives and those of others, the risk increases for everyone.
This tension between commercial interests and health is not unique to COVID-19. When antiretrovirals were developed to prolong the lives of those living with HIV, the annual cost was more than US$10,000 — making them completely unaffordable for the majority of people in the countries with the highest rates of HIV infection. This led to the adoption of the Doha Declaration in 2001, allowing countries to ignore patent protections for pharmaceuticals when there is a public health emergency. This includes allowing countries to manufacture their own generic versions of patented drugs.
Both India and South Africa have called on the World Trade Organization (WTO) to declare a public health emergency. Wealthy states resisted these pleas for months, but the United States and China have both announced that they would support a waiver in this instance, though pharmaceutical manufacturers and a number of European governments remain opposed. Drug companies argue that the move would stifle the innovations that allowed them to develop the vaccines so quickly, and European governments argue that the move will do little to ease the shortage. Even with…
Trade
Self-Reliance and Openness: Core Principles of China’s Third Plenary Session
The Third Plenum communique from the CCP indicates a prioritization of stability and compromise in response to China’s economic challenges. It highlights the concept of Chinese-style modernization and establishes political guidelines for balancing regulation and market forces.
The CCP’s Third Plenum communique signals a focus on stability and compromise in the face of China’s economic challenges. It emphasises Chinese-style modernisation and sets political directions for balancing regulation and market forces. While not as groundbreaking as previous plenums, it acknowledges the importance of market mechanisms and technological self-reliance, aiming to address issues like high youth unemployment and private sector uncertainty. The communique seeks to navigate the complexities of global competition and domestic innovation, potentially reshaping global supply chains and trade dynamics. Overall, it presents a pragmatic blueprint for China’s economic future.
Source : Self-reliance and openness central pillars of China’s Third Plenum | East Asia Forum
Trade
Trade Prevails Over Political Persuasions in China-Germany Relations
China and Germany maintain a strong bilateral relationship, rooted in economic cooperation despite ideological differences. Recent visits and agreements focus on expanding trade and addressing mutual concerns, navigating challenges while nurturing ties.
Evolving Bilateral Ties
China and Germany share a strong bilateral relationship, rooted in history since 1972. This connection has seen moments of cooperation intertwined with periods of tension. German Chancellor Olaf Scholz’s April 2024 visit underscores Germany’s commitment to fostering this partnership, reflecting a mutual interest in maintaining economic ties despite ideological differences.
Economic Pragmatism
As the second and third largest global economies, China and Germany’s economic interdependence is crucial. Germany emerged as China’s primary trading partner in 2023, with trade values reaching €254.4 billion (US$280 billion). In response to global scrutiny, Germany has taken a balanced approach, emphasizing economic stability over political discord. This was evident during Scholz’s prior visit in November 2022, where his diplomatic tone contrasted with broader EU sentiments.
Facing Challenges Together
Despite increasing public skepticism in Germany regarding China’s global influence and human rights issues, both nations continue to seek common ground. Their October 2023 Joint Statement highlights intentions to pursue cooperation in areas like carbon neutrality and open markets. To navigate these complex terrains, Germany can utilize its institutional frameworks to enhance dialogue, while also considering supply chain diversification to reduce dependency on China. The intertwining nature of their economies suggests that, despite challenges, both countries will continue to prioritize their substantial trade relations.
Source : Trade trumps political persuasions in China–Germany relations
Trade
Fixing fragmentation in the settlement of international trade disputes
Fragmentation in global trade due to the lack of development in multilateral trade rules at the WTO has led to an increase in FTAs. The Appellate Body impasse has further exacerbated fragmentation, requiring a multilateral approach for reform.
Fragmentation in Global Trade
Fragmentation in global trade is not new. With the slow development of multilateral trade rules at the World Trade Organization (WTO), governments have turned to free trade agreements (FTAs). As of 2023, almost 600 bilateral and regional trade agreements have been notified to the WTO, leading to growing fragmentation in trade rules, business activities, and international relations. But until recently, trade dispute settlements have predominantly remained within the WTO.
Challenges with WTO Dispute Settlement
The demise of the Appellate Body increased fragmentation in both the interpretation and enforcement of trade law. A small number of WTO Members created the Multi-Party Interim Appeal Arbitration Arrangement (MPIA) as a temporary solution, but in its current form, it cannot properly address fragmentation. Since its creation in 2020, the MPIA has only attracted 26 parties, and its rulings have not been consistent with previous decisions made by the Appellate Body, rendering WTO case law increasingly fragmented.
The Path Forward for Global Trade
Maintaining the integrity and predictability of the global trading system while reducing fragmentation requires restoring the WTO’s authority. At the 12th WTO Ministerial Conference in 2022, governments agreed to re-establish a functional dispute settlement system by 2024. Reaching a consensus will be difficult, and negotiations will take time. A critical mass-based, open plurilateral approach provides a viable alternative way to reform the appellate mechanism, as WTO Members are committed to reforming the dispute settlement system.
Source : Fixing fragmentation in the settlement of international trade disputes
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