Kenya is allegedly among the top ten developing countries in terms of revenue lost to the European Union and the United States. But what can be done? The author of this article makes a number of recommendations. At national level, he urges the Kenyan government to implement reforms to tax policy, trade policy, customs and laws and to promote inclusive growth. To make this work, he calls for both political will and active civil society participation. He calls on government to change the law to insist on maximum transparency for all international transactions, and for banks to give full disclosure to tax and relevant national authorities. The author argues for using the price filter model used by the United States Customs to monitor trade misinvoicing. The best solution, he notes, will be an international agreement for automatic exchange of tax information globally. In the meantime, he argues for Kenya to sign bilateral information exchange agreements with the major tax havens and secrecy jurisdictions, to be given information on accounts and companies registered in these jurisdictions that trade and do business with Kenya. He also argues for government to require all transnational companies to publish every year Kenya-specific accounts showing the profits or losses they make. Finally, he argues that Kenya follow the lead of Nigeria, which has sued major international companies for corruption and has been compensated through out-of-court settlements.
Health equity in economic and trade policies
Universal access to medicines was a key topic of discussion at a meeting on 11 July 2011 of health ministers from Brazil, Russia, India, China and South Africa (BRICS) in Beijing, China. The meeting, hosted by the Government of China, aimed to identify opportunities for BRICS countries to promote wider access to affordable, quality-assured medicines, with a view to reaching the Millennium Development Goals and other public health challenges. A ‘Beijing Declaration,’ issued on 11 July and signed by ministers of health from the five BRICS countries, underscored the importance of technology transfer among the BRICS countries, as well as with other developing countries, to enhance their capacity to produce affordable medicines and commodities. The Declaration also emphasised the critical role of generic medicines in expanding access to antiretroviral medicines for all. By signing the Declaration, leaders committed to working together to preserve the provisions contained in the Doha Declaration on TRIPS and Public Health—provisions that allow for countries to overcome intellectual property rights restrictions on medicines in the interest of public health. The five BRICS countries face similar health challenges, including a double burden of communicable and non-communicable diseases, inequitable access to health services and growing health care costs. Through collective action and influence, the BRICS coalition promises to deliver cost-effective, equitable and sustainable solutions for global health.
The Economic Partnership Agreements (EPAs) between the European Union (EU) and regions of African, Caribbean and Pacific states (ACP) are designed to encourage regional integration and improve trade capacity building and other aid interventions into the developing partner regions. The agreements cover not only trade in goods but also in services and other trade-related areas including intellectual property rights, which affect the production and availability of cheaper generic medicines for developing countries. The objective of this paper is to analyse why the trade and cooperation discussions with the EU have not made further progress towards the objective of African regional integration. This paper first presents an overview of the EPAs negotiations and outlines the main debates about EPAs. It then looks into regional integration in sub-Saharan Africa. It goes on to describe the precise integration objective associated with EPAs and how results have generally been disappointing in meeting the objective of furthering regional integration. The conclusion proposes recommendations on how to boost the negotiation process.
In this article, the author considers ways in which multinational companies avoid paying taxes in Africa, thereby undermining government commitments to education, housing and health, among others. The predominant way in which capital is hidden in trade and moved abroad is argued to be through the pricing of imports and exports. While a wide range of actors are argued to use this strategy, the author argues that multinational companies are more easily able to do so as they operate through subsidiaries scattered across the world, and have multiple subsidiaries, with trading between and among subsidiaries of multinational companies comprising as much as 60% of global trade. This gives significant scope for the use of transfer pricing.
The Society for International Development (SID)'s triennial World Congress, which concluded on 31 July 2011 in Washington, United States, drew over 1,000 attendees. According to the United Nations Development Programme, which attended the event, the emergence of new paths to development has grown along with the rise of middle- and low-income countries. However much of this growth has not been inclusive. A spokesperson for the UN Development Programme noted at the meeting that the empowerment of women was essential to the solid development of global international economies, a sentiment echoed by many others at the congress. Although 40% of participants were from the global South, one of the speakers, Sanjay Reddy expressed disappointment that the meeting was dominated by Northern development professionals, in particular those who appear to be engaged in for- profit contracting to execute development projects on behalf of organisations such as USAID. Reddy added that, if genuine grassroots development were to take place, SID should return to its original role of facilitating discussions between diverse groups, including voices that call for radically alternative methods to the current neoliberal agenda.
Members of the African, Caribbean and Pacific (ACP) Group and the European Union (EU) met on 31 May 2011 in Brussels, Belgium to continue ongoing negotiations on Economic Partnership Agreements (EPA). The ACP Ministers re-iterated their request for more flexibility on the part of the EU, including trade in medicines, and called for the reinforcement of the development components of EPAs. They also called for regional integration initiatives to be given precedence and for the preferential market access currently being provided under the EU’s EPA Market Access Regulation to be maintained and extended to other ACP countries until negotiations are concluded. In contrast, the EU Commissioner warned that the market access provided since 2007 to ACP countries that concluded EPA negotiations is temporary and predicated upon implementation of EPAs by ACP countries. He also announced that, owing to prolonged delays and stalemates in the negotiations, by the end of 2011 both parties will have to assess whether concluding negotiations is actually feasible within a realistic timeframe.
India and the European Union (EU) have signed an agreement that puts more stringent conditions on EU customs authorities that consider stopping shipments of generic pharmaceuticals passing through Europe. The EU has committed to change the regulation that led to seizures in 2008 of legitimate generics from India passing through the Netherlands and other European countries on their way to South America and Africa. The seizures had been initiated by European patent holders even though the shipments were in transit and not destined for European markets. A key element of the agreement is the core principle that ‘the mere fact that medicines are in transit through EU territory, and that there is a patent title applicable to such medicines in EU territory, does not in itself constitute enough grounds for customs authorities in any Member State to suspect that the medicines at stake infringe patent rights’. Only if there is adequate evidence of a likely diversion of medicines into the EU market, then can EU authorities have grounds for suspicion of infringement of intellectual property rights.
On his trip to South Africa on 18 July 2011, British Prime Minister, David Cameron, talked of the need to go beyond debt cancellation and aid and instead promote free trade with Africa. But ‘free trade’ on inequitable terms has been and will be of no benefit to Africa, the author of this article argues. Africa has much to learn from South Korea, the model to which Cameron refers as a successful example of free-market liberalisation. What Cameron failed to point out, the author notes, is that South Korea used a range of government interventions that are not accepted in free trade practice and are being denied to African governments. The author argues that African prosperity relies on a wholesale rejection of the western free trade model, which means protecting industries, developing alternative and complementary means of trading, control of food production and banking, progressive tax structures, controlled use of savings, and strong regulation to ensure trade and investment really benefits people.
The authors of this study developed a generic framework which depicts the determinants and pathways connecting global trade with the rise of chronic disease in many low and middle-income countries (LMICs). They then applied this framework to three key risk factors for chronic disease: unhealthy diets, alcohol and tobacco. This led to specific 'product pathways', which can be further refined and used by health policy-makers to engage with their country's trade policy-makers around health impacts of ongoing trade treaty negotiations, and by researchers to continue refining an evidence base on how global trade is affecting patterns of chronic disease. The authors argue the need for a more concerted approach to regulate trade-related risk factors and thus more engagement between health and trade policy sectors within and between nations. An explicit recognition of the role of trade policies in the spread of non-communicable disease (NCD) risk factors should be a minimum outcome of the United Nations Summit on NCDs in September 2011, with a commitment to ensure that future trade treaties do not increase such risks.
The author of this article argues that intellectual property rights, in a number of ways, impede access to antiretroviral (ARV) drugs in most developing countries with heavy burdens of AIDS-related mortality and morbidity. He recommends that developing countries that lack the necessary pharmaceutical capacity should exploit emerging opportunities for South-South co-operation. While countries like Brazil and India have produced generic ARV drugs, most developing countries either do not have the technology to do so or they are “pressured” against doing so because of the consequences of violation of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) enforced by the Word Trade Organisation. Most recently, Uganda entered into an agreement with Cipla, an Indian generic manufacturer of ARV drugs to open a drug plant in Uganda. Because such opportunities for South-South co-operation abound in contemporary global AIDS diplomacy, developing countries should ingeniously exploit them in ways that do not violate TRIPS. The impediments to this framework would include circumventing the hurdles posed by TRIPS as well as the pressure by global pharmaceutical corporate giants against such initiatives.