Posts Tagged ‘NGOs’

Undermining mitigation technology: compulsory licencing, patents and tariffs

August 30, 2008 by content_admin No Comments »

Undermining mitigation technology: compulsory licencing, patents and tariffs

The incentives to develop the technologies to reduce global CO2 emissions are being undermined.

Internationally, a campaign is being run to undermine the intellectual property that incentivises research and development on CO2 mitigation technologies. These technologies are vital to assist developing and developed countries to reduce their CO2 emissions based on their commitments in international treaties.
The campaign is being run by developing countries and NGOs claiming patents are reducing
the access to CO2 mitigation technologies beyond the means of developing countries.
These NGOs and developing countries are now advocating for amendments to the WTO’s
intellectual property rules (the TRIPS Agreement) to allow for compulsory licensing of CO2 mitigation
technologies. Compulsory licensing allows for the property rights to be waived on patented
inventions and the commercial return they provide. Without the commercial return there is no
incentive for investors to fund research and development into new technology.
Importantly, the industry is very much in its infancy. The stage of development of the industry
has been compared to the semiconductor industry 35 years ago, or the biotechnology industry 25
years ago. Compulsory licensing will stop the industry reaching maturity.
The campaign to undermine incentives for new research and development is not without precedent.
Advocates are using the successful campaign to compulsory license essential medicines under
the TRIPS Agreement as precedent. They are also advocating for the issue to be debated and included
in the next agreement out of the UNFCCC process scheduled to be completed in Copenhagen
in 2009.
By promoting compulsory licensing NGOs and developing countries are claiming that technology
will become more accessible. It won’t.
Numerous studies have found that IP rights are vital for technology transfer from developed to
developing countries. IP provides a tradeable right for an intangible good that assists patent holders
to transfer their property without fear of losing control of their technology.
Instead, studies have found that the bigger threat to technology transfer is not strong IP regimes,
but weak ones. Weak IP rules undermine both the incentives to innovate and discourages technology
transfer from developed to developing countries because the owners risk a violation of their property
Because of the importance of the private sector in developing the technologies to combat environmental
challenges, previous international treaties have explicitly acknowledged their role. The
Convention for the Protection of the Ozone Layer and the Kyoto Protocol both recognise the role
of private property rights to address their respective objectives. Both agreements also recognise the
private sector’s role in promoting technological diffusion.
The importance of the private sector is also acknowledged by Governments and multilateral
institutions. Both are currently working on programs to incentivise private investment into CO2
mitigation technologies. The ultimate consequence of undermining IP rights would be to undermine
these programs, as well as commercial incentives.
Attacking patents as the main barrier to technology transfer is also a distraction from the real
barriers that exist to technological diffusion in developing countries—tariffs and non-tariff barriers.
In the top 15 greenhouse gas emitting developing nations, tariff barriers for CO2 mitigation technologies
can be as high as 30 per cent. Non-tariff barriers can be as high as 160 per cent. Only one
country welcomes the free trade of CO2 mitigation technologies.
In comparison to campaigning against patents, if developing countries are serious about reducing
the cost of CO2 mitigation technologies, they can start by reducing the tariff and non-tariff


Adaptation Doesn’t Need Aid, say Civil Society Groups

December 10, 2007 by content_admin No Comments »

Tuesday, 10 December 2007, Bali, Indonesia: At the UN Climate meeting this week in Bali, ‘development’ NGOs, international agencies and some poor countries have claimed that government money in the form of ‘foreign aid’ channelled from wealthy countries to poor countries is the best way to create ‘adaptation’ to combat the effects of climate change.

Today, members of the Civil Society Coalition on Climate Change (CSCCC) disputed this idea and called on governments to reform their policies so as to stop inhibiting the poor from adapting.

Barun Mitra of India’s Liberty Institute, one of the 42 CSCCC members, admonished the proponents of climate aid, saying:

“ ‘Development’ charities from rich countries rely heavily on taxpayer-funded aid given by their governments to poor countries. Selling poverty may be a very successful business model for these charities, but it also prolongs poverty. After all, the ‘end of poverty’ will put these charities out of business.”
It appears that industrialised countries are attempting to pay off government officials in poor countries in exchange for a post-2012 climate agreement. And it is no surprise that this is happening in Indonesia, which was recently rated 144th on the Transparency International Corruption Perceptions Index.

Mitra continued:

“The world’s poor countries are being tempted to bite the foreign aid carrot in exchange for cutting greenhouse gas emissions after 2012.

But cash for climate will fuel corruption, prolong inefficiencies, aggravate emissions, and perpetuate poverty, all in the name of ‘climate control’.”

Data published in the Civil Society Report on Climate Change (December 2007)* show clearly that foreign aid has been largely unsuccessful in stimulating economic growth or adaptation:

  • From 1975 to 2002, foreign aid on average made no net contribution to the economic development of recipient countries.
  • Since 1960, foreign aid has, on average, had no perceptible impact on life expectancy.

Essentially, foreign aid is a substitute for taxation. It alienates governments from their electorate, by undermining their incentive to respond to the needs of their people. It reduces the need for governments to promote economic development.
Clearly, foreign aid is the wrong solution to climate change. Members of the Civil Society Coalition on Climate Change suggest that governments must stop inhibiting the poor from adapting. Specifically as this relates to climate change:

  • Governments should enable people to own their property, so that the poor will be able to invest in robust buildings and technologies that insulate their exposure to climate.
  • Governments should eliminate artificial barriers to entrepreneurship (such as licensing systems); i.e. it should allow entrepreneurs to supply insurance and infrastructure such as roads and bridges.

Government should eliminate restrictions that prevent people from accessing clean water, sewerage, and sanitation services. For instance, monopolies in services such as water and electricity should, at the very least, be subjected to competition from private entrepreneurs.