Wednesday, May 16, 2012
TRNN update on UNCTAD
The Struggle Over UNCTAD (and Why It Matters) ( via Naked Capitalism which seems to be one of the few main stream blogs featured in Economist's View which carries news of UNCTAD): "Some people see the Doha conference, therefore, as a draw. Others, because of the disproportionate power that the north has over the south, see this as a victory of the south, because it preserved the mandate of UNCTAD and it is allowing it now for the next five years or so to continue researching the question of finance, questions of economic development, as far as, you know, it being people-centered and not finance-centered. So because the mandate of the UNCTAD was not touched, there are people who say this is a major victory for the south,..........................There were two other points that were very important......One part of UNCTAD, you know, the division headed by Flassbeck, for instance, was producing reports critical of the way in which finance in particular had come to dominate social life. Another part was a pledge to helping investment capital enter the global south. And so there is—there was an imbalance at Doha, as there has been within UNCTAD for a long period. And this question has also been raised—you know, what is this double-headed nature of UNCTAD? And the third thing, very important thing, a preview of the rest of the summer's debates between north and south, this third thing was around the so-called new trade narrative.....we need to understand the new trade narrative as part of this supply chain, that every country in the world is linked into the supply chain; there is no real contradiction between north and south; there are no antagonisms in the world anymore; everybody just needs to find their place. In a way, this is the 21st century version of David Ricardo's comparative advantage theory.....But at the Doha meeting, the South African trade minister, Rob Davies, very strongly contested the story, and he said that, look, what you are trying to say is precisely why UNCTAD was created in the first place, because the first secretary-general of UNCTAD, Raúl Prebisch, critiqued this Ricardo kind of theory." Vijay Prashad goes on to explain the 'global supply chain': " I'll put it in the worst way. Malaysia will find the rubber. Singapore will produce certain kinds of technical equipment. This will be put together in Shenzhen in China. But the entire idea is created in the United States, and because of international property laws, the United States will protect its ability to make money off work done by people outside the United States. This is bad for U.S. workers, because it means there is no need to create jobs in America, and it's appalling for people in Malaysia and people in Shenzhen, because they make a very tiny part of the profit in the sale of whatever they're making. The bulk of that profit is going to be made by the so-called intellectual property holder, which is likely to be a major transnational corporation based in the north, and then it's going to be shared out to people who are lawyers, bankers, etc., whose job is to protect the copyright and to preserve the wealth accrued by this transnational firm. So if we get down to it, what Rob Davies said is this is a kind of new colonialism. It's not what we want." Vijay Prashad also thinks that China, Russia, India, Brazil oppsed the developed states not because of their opposition to neo-liberal economics but"....the section of this particular so-called new trade narrative that they are most upset by is something they've been upset by for 20-plus years, and that is the question of intellectual property rights. You know, if you look at the pyramid of profit, you know, it's actually a reverse pyramid of profit. If you look at it like that, you see that the country where the firms control intellectual property are able to make the most out of the global supply chain. You know, they are able to—because of so-called value added, they are able to make the most out of the sale of commodities. It's not the person who makes the Nike shoe in Indonesia that makes the money for Indonesia; it is still Nike in the United States who is reaping the—taking in the profits for Nike shoes, even though Nike doesn't actually make any shoes. You know, Nike is a design and brand firm. They don't actually manufacture shoes. But the design and brand section of the supply chain is where the real profits lie. So countries like Brazil, India, China, these countries are fighting to bring their own brands to market, to bring their own designs to market, and they are being held back by a global or international intellectual property regime that prevents many of them from pushing their brands forward. I mean, one of the real tricks in the 1980s that they are most upset by was the shift in intellectual property from where you copyright not the process by which you get to, say, a sneaker but the actual sneaker itself. That means that you cannot figure out a novel—your own way of making the same product, your own way of making, say, a drug that, you know, is antiretroviral. You can't do that, because now what is copyrighted isn't any longer the process but the product itself. And that is something that is holding back countries like China, India, Brazil. They are frustrated and angry about this one aspect of the global supply chain narrative."