In Focus

Call to Action: “Now or Never” by H.E. Thabo Mbeki, 21 November 2022

Combating Illicit Financial Flows : “Now or Never”

Statement of H.E. Thabo Mbeki, Chairperson of the African Union High Level Panel on IFFs

“I fully support the creation of a globally inclusive, intergovernmental process at the UN. I urged all international organisations and Member States to resist attempts to block this important step forward, and thus call into question our global commitment to fighting illicit financial flows and corporate tax abuse in support of the Sustainable Development Goals.”

* H.E. Thabo Mbeki is also the Chair of the Board of the South Centre.

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Second African Fiscal Policy Forum, 1 December 2022

Second African Fiscal Policy Forum (Part one): Curbing Illicit Financial Flows from Africa and Accelerating Asset Recovery for Sustainable Development

Date: Thursday, 1st of December 2022 Time: 03:00 – 06:00 PM (Addis Ababa Time)

The event will be hybrid.

In person: Addis Ababa

Following the outcomes of the First Forum held in December 2021, this Second Series will be held in three iterations. This first part of the Second African Fiscal Policy Forum will bring together key stakeholders to discuss the current global processes towards combatting IFFs, the role of African regional institutions, and the importance of supporting Africa’s Domestic Resource Mobilization efforts.

Organizers: Coalition for Dialogue on Africa, CODESRIA, South Centre, Rosa Luxemburg Siftung

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Research Paper 170, 17 November 2022

Left on Our Own: COVID-19, TRIPS-Plus Free Trade Agreements, and the Doha Declaration on TRIPS and Public Health  

By Melissa Omino and Joanna Kahumbu

The cusp of the twentieth anniversary of the WTO Doha Declaration on the TRIPS Agreement and Public Health (hereafter “the Declaration”) was marked by a global pandemic. The Declaration and its iteration in the Agreement on Trade Related Aspects of Intellectual Property Rights (hereafter “TRIPS”) Article 31 bis, should have helped to contain the devastation in least developed and developing countries. The reality is that the pandemic is still ongoing, and the Global South led by South Africa and India are seeking a waiver of provisions to the TRIPS Agreement to ensure that COVID-19 therapeutics, diagnostics, and vaccines reach their citizens in order to contain the spread of the COVID-19 virus (“the TRIPS waiver”). These citizens are especially vulnerable because of their inability to access vaccines due to their prices and supply shortages caused by the refusal to share manufacturing technology. The Doha Declaration aimed at reaffirming the interpretation and implementation of the TRIPS Agreement to support WTO members’ right to protect public health and promote access to medicines. However, the operationalization of the Declaration via Article 31bis of TRIPS has been cumbersome and procedurally difficult to navigate. This paper argues that the current iteration of the Doha Declaration within TRIPS fails to meet the objectives of the Declaration as demonstrated by the need for a further waiver of the TRIPS agreement. It also attempts to “reimagine” Article 31 bis in light of the TRIPS waiver from the position of the Global South to make it more equitable and practicable and maintain the spirit of the Declaration.

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SC Statement to the COP27, 16 November 2022

27th CONFERENCE OF THE PARTIES (COP27) OF THE UNFCCC

STATEMENT OF DR.  CARLOS CORREA, EXECUTIVE DIRECTOR OF THE SOUTH CENTRE

We all are aware of the magnitude of the climate crisis the world is facing. We are also aware that its impact is not the same for all countries and populations. The disasters we are witnessing affect most severely developing countries which historically have not been responsible for the emissions that put at risk the life in the planet. Those countries, the most affected, have the lowest capacity to address the devastating effects of climate change events and to adapt to and mitigate them.

Climate change is a cross-cutting issue. However, the international system operates in silos and has been incapable of ensuring the adoption of the multiple and coordinated policies necessary to address it. The South Centre, as an intergovernmental organization of developing countries, attaches particular importance to and focuses its work on the intersection of climate change policies with other policy frameworks.

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SouthViews No. 243, 15 November 2022

International Clean Technology Diffusion: Pathways and Prospects

By Wenting Cheng

International clean technology diffusion is essential to mitigate and adapt to climate change, while fast and optimal diffusion can be prevented by the paywall of patents. This article examines three pathways to foster international clean technology diffusion: through restriction of intellectual property, including imposing external restraints in environmental law; striking an internal balance in maximizing TRIPS flexibilities; and keeping the status quo. It finds that the first two treaty-based pathways may not work, and an operable pathway to promote clean technology diffusion is to maximize and consolidate TRIPS flexibilities in national laws. This option challenges the popular proposal of a “Doha-like” declaration on TRIPS and climate change due to the paralysed multilateral trade mechanism, asymmetrical negotiation power of developing countries, prolonged negotiation process, and categorization problem in treaty negotiations.

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Climate Policy Brief 28, 14 November 2022

Technology Transfer and Climate Change: A developing country perspective

 By Nicolás M. Perrone

The role of technology transfer in climate change negotiations is vital. If technology is to help us mitigate and adapt to climate change, the international community needs to ensure sufficient innovation and technology transfer. One of the main challenges of the technology transfer regime for environmentally sound technologies is that a private and market-led model may not meet global technology transfer needs. This policy brief suggests that governments should explore market, hybrid and non-market approaches to accelerate the transfer of environmentally sound technologies. Developing countries’ governments should also explore cooperative approaches to improve their bargaining power, reduce costs and ensure adaptation and innovation capacity in the developing world.

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Research Paper 169, 8 November 2022

The WTO TRIPS Decision on COVID-19 Vaccines: What is Needed to Implement it?

By Carlos M. Correa and Nirmalya Syam

The 12th WTO Ministerial Conference adopted a Ministerial Decision on the TRIPS Agreement on 17 June 2022. This partially concluded almost two years of protracted discussions in response to a proposal by India and South Africa for a waiver from certain obligations under the TRIPS Agreement for health products and technologies for the prevention, treatment and containment of COVID-19. The adopted Decision only waives the obligation under article 31 (f) of the TRIPS Agreement. Developing country WTO members are now allowed to export any proportion of vaccines, including ingredients and processes, necessary for the COVID-19 pandemic that are manufactured under a compulsory license or government use authorization to other developing countries. It also contains some clarifications of relevant TRIPS provisions, while introducing a number of conditionalities that are not present in the TRIPS Agreement. This paper examines the object and scope of the Decision, the requirements established for its use, and the required actions to be taken by WTO members to implement it.

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SouthViews No. 242, 4 November 2022

A Proposal for a New Approach to Restructuring African Eurobonds: The DOVE Fund and Principles

By Daniel Bradlow

This article argues that the current arrangements for restructuring sovereign bonds do not meet Africa’s needs. African states and their supporters should create a DOVE (Debts of Vulnerable Economies) Fund that can purchase the bonds of African sovereign debtors in distress and commit to restructure them in accordance with the DOVE Fund Principles. This Fund can help interrupt inter-creditor dynamics and push the bondholders to be more open to innovative approaches to debt restructuring.  This article, after briefly considering some of the problems with the current process for restructuring sovereign bonds, discusses the DOVE Fund and the DOVE Fund Principles.

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Tax Cooperation Policy Brief 26, 31 October 2022

Revenue Effects of the Global Minimum Corporate Tax Rate for African Economies

By Seydou Coulibaly

This policy brief provides the first piece of empirical evidence on the revenue implications of the recent global minimum tax rate reform agreement for African economies. We implement a regression discontinuity design to evaluate the effect of having an effective corporate tax rate of at least 15% on tax revenue collection for a panel of 28 African economies over the period 2000-2020.

The estimation results indicate that the implementation of the global minimum effective corporate tax rate of 15% proposed under Pillar II of the Organisation for Economic Co-operation and Development (OECD) Two Pillar Solution has a positive but not statistically significant likely impact on corporate tax revenue and total tax revenue at the conventional significance levels. This suggests that the global minimum tax deal is unlikely to increase tax revenue for African economies. These findings exhort the Inclusive Framework and all the stakeholders of the global tax reform negotiations to consider revising the global minimum tax rate rules to ensure that the agreement will effectively benefit African countries through better tax revenue collection.

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Research Paper 168, 28 October 2022

TRIPS Flexibilities and Access to Medicines: An Evaluation of Barriers to Employing Compulsory Licenses for Patented Pharmaceuticals at the WTO

By Anna S.Y. Wong, Clarke B. Cole, Jillian C. Kohler

Under Articles 31 and 31bis of the TRIPS Agreement, WTO members may validly sanction the use of a patented invention without the patent owner’s authorization by issuing a compulsory license (CL). In the pharmaceuticals space, governments have historically employed compulsory licenses to compel originator manufacturers to license their patents to generic manufacturers before patent expiry, increasing the supply and reducing the price of patented pharmaceuticals domestically.

This paper evaluates the three primary barriers to employing compulsory licenses for pharmaceuticals underscored by members during TRIPS waiver discussions at the WTO: (1) a lack of enabling domestic legislation, (2) a lack of domestic manufacturing capacity coupled with an unworkable Article 31bis importation system, and (3) consistent political pressure from other members to refrain from issuing compulsory licenses. A survey of members’ domestic compulsory license legislation finds that virtually all members have enacted enabling legislation under Article 31 for the issuance of compulsory licenses to supply their local markets. However, implementation of Article 31bis is limited by a lack of enabling compulsory license export legislation, streamlined administrative processes, or both across all members, preventing members lacking domestic manufacturing capacity from importing pharmaceuticals. An analysis of USTR Special 301 Reports from 1994-2021 further reveals that countries have consistently been placed on the Special 301 Report Priority Watch List for issuing pharmaceutical compulsory licenses, with instances as recent as 2020. As such, general reluctance by members to issue compulsory licenses due to overt political pressure through the Special 301 Report is likely warranted. These results highlight a range of barriers preventing the full use of compulsory licenses for pharmaceuticals under the current Article 31 and 31bis framework, with the effects disproportionately borne by member states lacking domestic manufacturing capacity.

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Key Messages from UNCTAD & SC HLM on S-S Solidarity on Adaptation, 25 October 2022

Key Messages from the High-level meeting organized by UNCTAD and South Centre on Building South-South Solidarity on Climate Adaptation

Geneva, 25 October 2022

Drawing on the discussions from the meeting organised by UNCTAD and South Centre on 25th October 2022 on “Building South-South Solidarity for Climate Adaptation”, UNCTAD and South Centre believe that South-South solidarity is indispensable to ensure the needed international support for the Global South to break the eco-development trap, strengthen their climate adaption capacities, and achieve sustainable development. UNCTAD and South Centre therefore urge developing countries to build South-South solidarity and common positions in climate negotiations in the UNFCCC and the Paris Agreement as well as in the trade and environment discussions at the WTO and other multilateral fora.

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Research Paper 167, 27 October 2022

Analysing Intersections between Climate Change and Human Rights

By Daniel Uribe Teran and Luis Fernando Rosales

The effects of climate change on people’s daily lives threaten the full enjoyment of human rights. The Human Rights Council adopted two landmark resolutions recognising the human right to a clean, healthy and sustainable environment (Resolution 48/13), and establishing the mandate for a Special Rapporteur on the promotion and protection of human rights in the context of climate change (Resolution 48/14). Nevertheless, a broader dialogue between the UNFCCC and the UN human rights architecture seems necessary to establish a coordinated and coherent response to climate change and its effects on human rights.

This research paper analyses the intersections of these two legal systems. It does so by identifying how the climate change negotiations and the human rights architecture can contribute to strengthening international cooperation. It also recognises the need for a more profound international debate on the linkages between human rights and climate change consistent with the principles of equity and common but differentiated responsibilities included in the UNFCCC.

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