Financial Forecasts and Alleviating WTO Rules to Meet COVID Challenges

The WTO forecasts a 9.2% decline in the volume of world merchandise trade for 2020, followed by a 7.2% rise in 2021. These estimates are subject to an unusually high degree of uncertainty since they depend on the evolution of the pandemic and governments’ responses to it. The good news is that current data suggests a projected decline for the current year that is less severe than the 12.9% drop foreseen in the WTO’s April trade forecast. Strong trade performance in June and July have brought some signs of optimism for overall trade growth in 2020. Trade growth in COVID-related products was particularly strong. However, the forecast for 2021 is more pessimistic than the previous estimate of 21.3% growth.

Meanwhile South Africa and India have proposed a temporary waiver of certain TRIPS (Trade-Related Aspects of Intellectual Property) obligations in order to assist in the global response to COVID. South Africa and India argue lifting the relevant rules (Section 1 on copyright and related rights, Section 4 on industrial designs, Section 5 on patents and Section 7 on the protection of undisclosed information) will avoid barriers to the timely access to affordable medical products including vaccines and medicines and to scaling-up of research, development, manufacturing and supply of essential medical products. The waiver would last for a specific number of years, as agreed by the General Council, and until widespread vaccination is in place and the majority of the world’s population is immune. Members would review the waiver annually until its termination. This proposal has been prompted by fears that large pharma companies supported by certain developed countries in which they are based will prevent developing countries from benefiting from successful vaccinations or other medical support systems at reasonable prices.