[Ip-health] The Guardian: Europe's business take on development

Joanna Keenan-Siciliano joanna.l.keenan at gmail.com
Fri Feb 3 03:48:22 PST 2012


The Guardian: Europe's business take on development

The European commission's latest statement on development policy reveals
its continued emphasis on serving corporate interests ahead of combating
poverty [IP provisions in EU/India trade negotiations highlighted as an
example]

http://www.guardian.co.uk/global-development/poverty-matters/2012/feb/03/europe-business-take-on-development


On 27 January the European commission released a statement entitled Trade,
Growth and Development – Tailoring Trade and Investment Policy for Those
Countries Most in Need (pdf). The policy reduces development goals to a
narrow set of statistics, ignoring the needs of millions of poor people.
Worse than that, and despite the failure of the banking system, and the
global corporate tax heist, the policy continues to put corporate interests
before development.

The statement's title suggests the aim is to ensure trade and investment
policy help to achieve development priorities in line with the EU
commitment to policy coherence for development. However, there is little in
the document to support this. Instead, it suggests that trade policy should
"project EU values and interests", and even that "effective development
policy is essential in helping create better conditions for trade and
investment in developing countries" – development at the service of trade,
rather than trade as a tool for development.

It is also a clear attempt to assuage business fears about emerging
economies such as China and India by refocusing the trade and development
programmes on least developed countries (LDCs).

The commission is basing its poverty analysis primarily on average income,
which means that its policy is blind to the huge disparities within
countries, and therefore to important development needs. Based on this
flawed analysis, it is proposing to remove 79 out of 176 countries from
trade preferences under its generalised system of preferences scheme –
leaving, for example, Botswana and Namibia in the same trading position as
Brazil. The timing of this is clearly intended to put pressure on countries
to sign economic partnership agreements (EPAs).

A narrow focus on a small number of countries will not be enough to attain
the millennium development goals. The commission is attempting to reduce
India's trade preferences, yet the country has the largest number of poor
people in the world, despite being classed as a lower middle-income country
by the World Bank. Many LDCs are in regional groupings with countries that
have a different classification; if the commission imposes different market
access arrangements within the groupings, it will be much harder for
regional markets to develop, further entrenching developing country
dependency on markets that have become increasingly volatile.

What is particularly worrying about the statement is that "aid for trade",
a potentially useful tool for building developing country capacity to
trade, is to be diverted to serve the interests of EU business. So, for
example, it envisages "a higher share of aid … be delivered through …
innovative financial tools". These tools include loans and risk capital to
"support the viability of strategic investments".

The Jubilee Debt Campaign's action on the UK's export credit guarantee
scheme clearly demonstrates the dangers of such approaches, which can lead
to developing countries taking on yet more debt, while businesses reduce
their risks to a minimum.

The statement does nothing to address developing country concerns about the
way the EU has handled negotiations to date, particularly for EPAs with
African, Caribbean and Pacific (ACP) group countries. As reflected in
Traidcraft's 2007 report, EPAs: Building or Shattering African Regional
Integration, the EU has ignored their proposals and used bullying tactics
and artificial deadlines that cause tensions in regional blocs.

Nor does the commission's statement recognise the negative impacts that
premature liberalisation, combined with a failure of developed countries to
tackle their own trade-distorting practices, can have on developing
countries. For example, the undermining of African cereal and dairy sectors
through a combination of market opening (leaving them vulnerable to global
price shocks) and continued subsidising of EU produce (which pushes down
prices and contributes to EU overproduction).

In fact, instead of addressing these concerns, the EU blames the economic
policies and "poor governance" of developing countries, citing in
particular the "lack of stability" and "tax evasion" in those nations –
fine words from the EU, that bastion of stable economies.

Most important, companies – including in the services industries like
finance – that are seeking new markets in developing countries will
continue to reap the benefits of trade without assuming any of the
responsibilities. For example, if companies get their way on regulation of
intellectual property rights in the proposed EU-India free trade agreement,
India's generic medicines industry will be hit, increasing exponentially
the amount people in developing countries will have to pay for essential
medicines for HIV and malaria.

It is time the EU put development interests above those of big European
corporations. This means listening to developing countries and offering
greater flexibility in negotiations. A good start would be to offer, as an
alternative to EPAs, the everything but arms scheme to non-LDCs in Africa
that are in regional groupings where LDCs are in the majority – giving them
straightforward access to EU markets and helping to support regional
integration.

The EU should also stop using artificial deadlines to bully countries into
signing deals that they do not think are in their interests – this means
stepping back from the 2014 deadline for countries to begin implementing
EPAs.

It also means a clear separation between corporate interests and
development interests – it may be in the interests of the pharmaceutical
industry to introduce stricter intellectual property rules, it is certainly
not in the interests of poor people struggling to get access basic
medicines.

All these would be steps in the right direction towards a policy that was
genuinely in tune with development goals.

...


Joanna Keenan
Press Officer
Médecins Sans Frontières - Access Campaign
E: joanna.keenan[at]geneva.msf.org
T: @joanna_keenan

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