Patents could trap developing nations at end of value chain
- Source: Global Times
- [23:23 July 14 2010]
- Comments
By Ken Shao
Foreign media show little enthusiasm for reporting Walmart's recent food scandal in China.
The global retail giant is enmeshed in an unprecedented lawsuit on selling again genetically modified (GM) rice in its Chinese stores, which is illegal under Chinese law. The plaintiff, Greenpeace, a leading international environmental protection NGO, stated that the effects of GM foods on environment, biodiversity and human health remain unknown.
That Walmart has been repeatedly testing the water probably reflects a possibility that GM foods are safe or will soon be safe. If so, China will be pushed to open its vast food market for multinational companies, which strikingly include Walmart and its possible GM rice supplier Monsanto, a US-based multinational biotechnology corporation that controls 90 percent of the world's GM seeds distribution.
But can we be relaxed if the GM foods are perfectly harmless?
This query leads to a very real problem, a problem that is caused, ultimately, by the global overprotection of patent.
Here we are not talking about rocket science but how patent affects everyone's living standard on the planet.
The magic of patent is that it requires every user of the relevant technology to pay a fee, which is normally expensive. Sad stories are just too many.
US women with breast cancer used to pay about $3,700 for a single, non-repeatable test simply because of the sacred gene patent owned by Myriad Genetics, a US-based leading biotechnology company.
In a revolutionary judgment in a US district court in March 2010, Myriad Genetics's gene patent was held invalid on the ground that those genes, by their nature, should be available freely.
This judgment however can only scratch the surface. It will take decades to clean up all those improperly granted patents, most of which are globally effective.
The global power of patent is safeguarded by the formidable Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). By enforcing global patents, the TRIPS deprives developing nations of the freedom of using, copying and redesigning technologies that most developed nations enjoyed during their early stages of becoming rich. This fundamentally hinders the improvement of living standard in developing nations.
Can developing nations create their own technologies then? Yes, but it is proven to be hard. Technological innovation today is highly cumulative. Any further breakthrough is likely to violate existing patents if expensive, often unaffordable licensing fees are not paid.
A carefully designed tool, the TRIPS therefore helps to maintain a global value chain in which the privileged control technologies and the disadvantaged supply cheap labor.
This phenomenon needs to be understood in the context of the WTO, the governor of the TRIPS and the only international body dealing with global freedom of trade. By worldwide free trade, the patented, expensive products and processes can be distributed everywhere.
This is why Monsanto, for example, can control, through its gene patents, the entire chain of soybean, corn or cotton production in various developing countries.
The WTO can issue rulings against member countries that are deemed to have violated free trade. The EU in 2006 was required by the WTO to lift its ban on GM foods produced in the US. The EU's position was a response to significant public protests in Europe against GM foods. However, health and environment are not the focus of the WTO.
The WTO-TRIPS regime is firmly buoyed by multinational companies, which through the patent system and free trade are able to control the global value chain and maximize their vast, snowballing profit.
Because many multinationals are headquartered in the US, the US government has been very supportive to their global expansion.
Hence, Walmart's gamble of selling banned GM rice in China is driven by the power of economic globalization, through which patent-rich multinationals want to mine and share the immense Chinese market with retail multinationals such as Walmart.
Therefore, even if GM rice is perfectly safe, we still face the serious problem of the gene patent monopoly that, through the WTO-TRIPS regime, attempts to maintain a global value chain in which developing nations are designed to primarily supply cheap labor.
It's reminiscent of the enclosure of land in 18th century England, where the rich and powerful were able to seize land that was previously held in common.
Gene technology is a new land. Will China be enclosed?
The author is an expert on international intellectual property law. forum@globaltimes.com.cn
