Rep. Ron Kind (D-WI) and Rep. Earl Blumenauer (D-OR) are promoting legislation that would force the US to be a scofflaw. Last week, two members introduced legislation that would prohibit the US from making an annual payment of $147 million to Brazil.  They’re outraged that the US makes this payment – a sort of hush-money – to induce Brazil from punishing the US with more painful penalties under a WTO ruling against US cotton subsidies.

A cotton field in North Carolina. Photo: Liliana Rodriguez / Oxfam America

Kind and Blumenauer think it’s absurd to be paying off Brazil when we have a budget crisis, and want to bring pressure on Congress to reform the cotton subsidies rather than make this annual payment.  This would happen through the Farm Bill, which Congress was unable—or unwilling—to pass last year.  The House Agriculture Committee will restart the process on May 15 with a “markup” in the committee.

Even if Congress does pass a new Farm Bill, it’s not clear that it will reform cotton subsidies.  Last year’s draft versions of the Farm Bill didn’t come close, and Brazil could still retaliate.

Strangely, Brazil has been very gentle with the US and has refrained from harsher penalties for years.  When Congress failed to pass a Farm Bill and reform cotton subsidies last year, Brazil meekly agreed to keep the current payment.  They might not get their full payment this year, actually, as US Agriculture Secretary Vilsack may think the budget sequester, which shaves spending all over the government, will apply to the Brazil payment.

Perhaps, Brazil’s patience with the US over cotton subsidies can be explained by the fact that the Brazilian Ambassador to the WTO, Roberto Azevedo, is vying for a new job as head of the WTO. It certainly wouldn’t help his campaign to alienate one of the biggest member states. I’ve met Minister Azevedo and respect and like him a lot, so I don’t mean to impugn him or imply anything unethical.

At some point, the WTO job will be filled and then, perhaps, the US will have run out of leverage and exhausted Brazil’s patience.

David Waskow is Oxfam America’s climate change program director.

When I read headlines like this one last week, “Vietnam Coffee Harvest May Drop 30% on Drought,” I’m left with the feeling that the tablecloth is being pulled out from under the dishes on the table.

Dry, cracked earth seen at Dire Dime, Ethiopia. Photo: Eva-Lotta Jansson/Oxfam America

And it’s climate change that is doing the pulling.

Food production is already being pummeled globally by increasingly-severe climate events and other climate impacts, with more on the way. Small-scale farmers in developing countries are bearing the brunt of the damage – all too often, the crops they depend on for their lives and livelihoods are directly in harm’s way.

So when Oxfam began work on our new Behind the Brands initiative and a Scorecard assessing the policies of the ten largest food and beverage companies on a range of issues that are vital for small-scale farmers, climate change was right in the mix.

We examined company policies on climate change in two ways, looking at how they’re dealing with both the causes and the consequences of global warming.  First, we wanted to know whether these major companies are working to address climate change risks in their supply chains and if they are working to support the resilience of small-scale farmers in the face of impacts such as water scarcity and storms.  Second, we wanted to know whether the companies are working to cut emissions of the greenhouse gases that cause climate change, especially from agricultural sources.   (Much of our scoring is based on company reporting based on the CDP (formerly Carbon Disclosure Project) reporting format.)

What we discovered surprised us.  Just because a company did well in one area – building climate resilience or reducing emissions –didn’t mean it did well in the other.  Unilever, which scored 74% on the scorecard elements about emissions, scored only 30% in terms of its policies about climate risks and building the resilience of small-scale farmers.  The company needs to bring its focus on resilience up to its focus on emissions, which itself can still improve.  Unilever’s failure to address  resilience represents the overall dismal state of affairs when it comes to the ten companies’ engagement on climate risks and the impacts that small-scale farmers face. The average company score on this was 25%.

One company, Nestle, did quite well with its policies on climate resilience.  Nestle scored 83% on the resilience elements of the scorecard, largely because the company’s CDP reports and other policies highlight the importance of addressing climate impacts such as water shortages and volatile weather patterns.  Sadly, however, the company didn’t do so well when it comes to emissions.  Nestle has only average policies on emissions, with a score of 44%, and a below-average score at 23% for its policies specifically on agricultural sources of emissions.

But, frankly, what surprised and disappointed us the most was that some companies had weak policies on climate change across the board.  Associated British Foods, General Mills, and Kellogg’s each scored 3%, 9%, and 12%, respectively, on climate resilience.  And the same three companies scored 15%, 0%, and 8%, respectively, when it comes to those companies’ policies on emissions from agricultural sources.  These companies are the real laggards on addressing the causes and consequences of climate change in their supply chains.

They need to realize that the table cloth is being swiftly pulled out from under them and that our food and drinks—and the lives of the poorest around the world—will surely come crashing down as a result.

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This post by David Waskow is part of a Behind the Brands blog series on Politics of Poverty that examines the seven issues relating to poverty and big food companies’ supply chains. Read other posts on land, women, farmers, transparency, water, and workers!

Frank Mechielsen is the Private Sector Lobbyist at Oxfam Novib.

Do the Top 10 companies featured in the Behind the Brands Scorecard have transparent policies? Do they share their practices with the public?

It is not easy to look beyond the tip of food system’s iceberg, to see how the farmers and workers produce our favourite brands. Who has produced the NESCAFÉ which I drink? Where do the coffee workers live who harvested the coffee beans? Which trader sold them to Nestlé? To whom did the cocoa farmers produce and sell their cocoa beans? What price did they get?

But Oxfam found in the Behind the Brands scorecard process that some companies are more transparent about their sourcing than others.

I was positively surprised that Mars, a private company, is relatively open about its sourcing volumes and buying agents. As a family corporation, Mars does not have shareholders peeking over its shoulders. Only Unilever is more open about the volumes of tea, palm oil, tomatoes, and other commodities it buys. And Nestlé is more transparent about the sourcing countries.

I was also impressed by Danone, which gets its highest thematic score of 6 on transparency. It is number two of the Big 10. The policies of Danone related to women, farmers, and land are weak, but at least the company is becoming more transparent about their sourcing because of their recently published forest footprint policy.

On the other end, it gets murky. We find General Mills with a score of 2 and Associated British Foods with a score of 3 on transparency. General Mills provides information about the volumes of palm oil only and disclosure about buying agents is limited to one cane sugar supplier. Associated British Foods does inform the public about the volumes of palm oil and sugar it buys, but no further information about the sourcing volumes of other commodities.

Oxfam also looked for evidence of food companies’ transparency in their lobbying activities. The European Transparency Register is a voluntary initiative for companies to provide some information about their political activities.  Neither General Mills nor Associated British Food report in Europe on their lobby activities and, according to the Global Reporting Initiative, are less transparent about their corporate reporting than most of the Big 10.

It’s what can’t be seen under the water that is dangerous. Food companies, more clarity required.

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This post by Frank Mechielsen is part of a Behind the Brands blog series on Politics of Poverty that examines the seven issues relating to poverty and big food companies’ supply chains. Read more on land, women, farmers, water, workers, and climate change!

Erinch Sahan is a Private Sector Policy Advisor at Oxfam Great Britain.

Badou Allouko on her farmland, where she grows cocoa to sell and vegetables for personal consumption, in Sankro, Ivory Coast in January. Photo: Peter DiCampo / Oxfam America

In a world where demand for agricultural production is growing, but supply is failing to keep up, small-scale producers are critical to our food security. With the right investment and inclusive business approaches, small-scale farmers can be immensely productive and a reliable source of supply.

Small-scale farmers are also becoming critical to the ‘Big 10’ food and beverage companies. Oxfam assessed how the policies and commitments of the Big 10 stack up in our Behind the Brands report. We found that most of the Big 10 are missing the mark in ensuring a fair deal for small-scale farmers. This is a missed opportunity, not only because small-scale producers are central to the supply-security concerns of the Big 10, but also because rural economic development is so strongly linked to small-scale agriculture.

Here’s the development case. While the world produces more than enough food to feed everyone, 900 million people go to bed hungry each night. 80% of these hungry people live in rural areas, mostly working as small-scale producers. As Bill Gates said in 2009 at the World Food Prize ceremony:

“Helping the poorest smallholder farmers grow more crops and get them to market is the world’s single most powerful lever for reducing hunger and poverty.”

There are over 400 million small-scale farms on which 1.5 billion small-holder and landless farmers earn their livelihoods and grow their food. Some of these farmers are able to crack into the global supply chain. Too often, these ‘lucky’ few are left baring disproportionate levels of risks and costs. The vast majority are left behind, excluded by business models that fail to invest in and adapt to the realities of small-scale agriculture.

Among the Big 10, Unilever tops Oxfam’s Scorecard on farmers with a score of 7 out of 10. Mars and Nestle come equal second, with a score of 5. Unilever is distinguished mostly by its Sustainable Agriculture Code, which sets out guidelines and requirements for suppliers of Unilever to meet. As most of the Big 10 don’t deal with small-scale farmers directly, it’s the standards they require of their suppliers that matters most. Unilever’s code asks suppliers to work with producer organisations and provide training to small-scale farmers, as well as having specific clauses dealing with profit margins and local market opportunities for small-scale farmers. However, most supplier codes of the Big 10 do little nothing to single out any support or protection for small-scale farmers.

Oxfam hopes to see the Big 10 improve their policies and commitments to small-scale farmers in their supply chains. It starts with understanding the needs of these farmers and knowing where they are. Small-scale producers too often bear disproportionate risks and costs, but profits fail to trickle down. The Big 10 need to use their power and influence to stop this injustice. Most critically, the Big 10 need to make absolutely clear that they expect small-scale farmers to be treated fairly by all suppliers. Taking a strong stand on this in their supplier codes is an important step we hope more of the Big 10 take.

Who among the Big 10 will challenge Unilever for the top-score on farmers? Bragging rights is up for grabs.

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This post by Erinch Sahan is part of a Behind the Brands blog series on Politics of Poverty that examines the seven issues relating to poverty and big food companies’ supply chains. Read more on land, women, transparency, water, workers, and climate change!

Yesterday Oxfam received a response to its call to action from Nestlé, one of the three chocolate companies we’ve engaged on behalf of women cocoa farmers. We welcome Nestlé‘s letter as an indication of Nestlé‘s intent to do more for women cocoa farmers and workers. Nestlé‘s Executive Vice President for Operations, José Lopez, indicates an earnest seriousness on behalf of Nestlé to take these issues and Oxfam’s call to action. However, it does not go far enough in making a strong commitment for women’s empowerment.

N'Dri Chantal Konan, age 70, separates the pulp from cocoa in Allahteresekro, Ivory Coast in January 2013. Photo: Peter DiCampo / Oxfam America

Firstly, if Nestlé were truly ready to do something for women, why not start with committing to the UN’s Women Empowerment Principles? This would go a long way toward showing Oxfam, consumers, and most importantly the women in Nestlé‘s supply chain that they are committed to tackling gender issues. In 2012, Nestlé did conduct an assessment of Nestlé’s cocoa supply chain with the Fair Labor Association in Cote d’Ivoire, as well as recent consultations on child labor. Their letter to Oxfam indicates a willingness to consider the recommendations on women in that report, but does not yet commit to knowing and showing what is happening to women more broadly in their cocoa supply chain by conducting a separate assessment.

Furthermore, we are not surprised to hear that members of the cooperatives involved in Nestlé‘s Cocoa Plan are almost all men. That is precisely the problem. Nestlé and other chocolate companies shouldn’t just accept this, but rather incentivize its suppliers to more actively include women in co-ops, and particularly in decision-making processes. Nestlé must be more active in targeting training for women farmers, recognizing the critical role they play in pre and post-harvest.

Nestlé indicated in the letter that they will come with a detailed plan in some weeks. We are looking forward to the reviewing the plan and the necessary actions.

My colleagues and I were surrounded by women dressed in their best. Their colorful, patterned pagnes, or cloth wraps, were everywhere I turned in the village of Kouadioyaokro, Cote d’Ivoire (Ivory Coast). I was in West Africa in January to listen to women cocoa farmers about their roles in the supply chains that result in my favorite chocolate treats.

Etchi Avla on her cocoa farm in Botende, Ivory Coast in January. Photo: Peter DiCampo / Oxfam America

Cote d’Ivoire is the world’s top cocoa exporter, producing about 40 percent of the world’s crop, and used to make the mass-produced foods like candy bars and chocolate milk you find at your neighborhood grocery story. The United States imports more than half of its cocoa beans from the West African country—three times more than from the runner up, Ecuador. The vast majority of cocoa production comes from small farms of less than 5 hectares in size. These farms are, for the most part, owned and operatedby men.

It seemed every woman that lived in the village showed up to our meeting in Kouadioyaokro. These women were ready to be heard and to be recognized! While women play essential roles in farming cocoa, their work traditionally has been undervalued, ignored, and often underpaid.

Through our discussions, we found little evidence on the ground that the international food and beverage industry are doing its part to uplift the livelihoods of female smallholder farmers in the cocoa industry. Extraordinary profits from cocoa are built on the labor of millions of women (and men) living in poverty like those whom I encountered in Cote d’Ivoire.

Oxfam last week released its Behind the Brands report. The report contains a Scorecard that ranks the top 10 food companies on seven themes: workers, farmers, women, land, water, climate and transparency. one key area where companies were failing—women.

Women represent at least half of the workforce in agriculture and women’s work in agriculture is often not visible, or simply not valued, despite the immense physical and inner strength required by the women with whom I met in Cote d’Ivoire. Complex and long-standing gender divisions result in women being excluded from more profitable aspects of agricultural enterprises. Women have limited access to resources such as land, credit, technical agricultural support, social security, and other services. They do unpaid work at home, face high levels of illiteracy, and lack bargaining power. They often face discrimination and unequal treatment on commercial farms, limiting their access to resources, equal wages, training, and leadership positions.

The greatest paradox is that women are often the key to food security for their own families. For this reason, Oxfam would like companies to begin the race by improving their policies and practices that affect female smallholder farmers.

Companies can begin by engaging with people like Olga Rosine Adou, the founder and president of the cooperative, COOPASA, in southeastern Cote d’Ivoire. When we met, Olga told us that cocoa companies could help her and other women cocoa farmers in her community.

“We want these conditions to get better. We want men to understand that women can do what men do. With international pressure, things will start to change.”

Oxfam is calling specifically on the three largest cocoa sourcing companies in the world—Mars, Mondelez and Nestle—to do more for women cocoa farmers. These companies must:

#1 Look: ‘Know and show’ that women are treated fairly by assessing and reporting on the economic and social status of women in cocoa supply chains.

#2 Listen: Respond to the demands of women in cocoa supply chains and make public commitments to protecting women’s rights and ensuring opportunities for female smallholder farmers.

#3 Act: Take concrete steps to redress gender inequities in the company’s cocoa supply chains and influence others to do so as well.

This International Women’s Day—March 8, 2013, let’s take a stand for women who work on cocoa farms, and those facing inequalities around the world.

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This post by Irit Tamir is part of a Behind the Brands blog series on Politics of Poverty that examines the seven issues relating to poverty and big food companies’ supply chains. Read more on land, farmers, transparency, water, workers, and climate change!

Jonathan Jacoby is Policy and Campaigns Manager in the Private Sector Department at Oxfam America.

The ingredients of a memorable event can be hard to come by.  I may be (am) biased, but Oxfam’s gathering last Friday morning in New York City to highlight our new Behind the Brands scorecard had them all:

#1 A stunning and symbolic setting

In the 29th floor auditorium of Bloomberg‘s headquarters, we had found a venue with a sense of power.  Thanks to Curtis Ravenel and his Sustainability team at Bloomberg LP, the view of midtown Manhattan, Central Park, and the East River was exquisite.

#2 A sumptuous spread

Breakfast is the most important meal of the day and this one started us off right.

#3 A skillful scene-setter

In his intro, Oxfam America president Ray Offenheiser demonstrated our long-standing focus on food and agriculture—Oxfam’s proverbial “bread and butter”. He then laid out our approach to evaluating the role of the world’s 10 largest food and beverage companies on 7 key themes through the Behind the Brands project.

With the scorecard displayed behind him, Ray saluted how far the “Big Ten” – the most influential brands in the global food system – have come, but he made clear how far they still have to go to develop comprehensive policies on the social aspects of sustainable agriculture. He made both a humanitarian case and a long-term business case for companies to compete in a “race to the top”. Such a race will help secure the long-term bottom line while ensuring that the planet’s 7 billion food consumers have enough to eat and that the developing world’s 1.5 billion food producers (small-scale farmers and farm workers, especially women) enjoy the rights and opportunities to thrive. 

Panel at Behind the Brands March 1st event: (L to R) Jane Nelson, Erika Karp, Bennett Freeman, Puvan Selvanathan, Stephanie Strom, Ray Offenheiser. Photo: Ipek Gencsu / Oxfam America

#4 A classy cast of characters

On the panel were:

• Erika Karp: head of global sector research at global investment bank UBS; board member of the Sustainability Accounting Standards Board and other initiatives bringing environmental and social factors into clearer focus for the business and investor communities
• Puvan Selvanathan: head of sustainable agriculture at the United Nations Global Compact; former Chief Sustainability Officer at major Malaysian conglomerate and palm oil producer Sime Darby
• Jane Nelson: lecturer at the Harvard Kennedy School; director of its Corporate Social Responsibility Initiative; and a Brookings Institution senior fellow and all-around public intellectual on the subject.
• Bennett Freeman: senior executive at leading social investment firm Calvert; former State Department official and chief speechwriter; and yes, former board member of Oxfam America.

#5 An inquisitive and insightful moderator

Stephanie Strom, veteran New York Times business and financial journalist, brought to the fore the panelists’ diverse perspectives and enabled them to achieve a certain organic chemistry.

#6 Not just blah, blah, blah

Here are some of the highlights of the substantive dialogue:

• Transparency as Transformational: The panelists applauded the scorecard’s accessibility on complex sustainability issues, as well as its focus on transparent supply chains as a means to spark transformational action. Transparency is a powerful catalyst to get “competitive juices flowing” among these industry leaders, as Bennett Freeman of Calvert put it. He and other panelists spoke passionately about the need both to praise these food and beverage companies for the good they are doing while holding them accountable for a lack of clear policies and for any harmful practices. There was some discussion among panelists about the importance of bolstering and empowering internal champions within such companies to enable bold action in the executive suite.

• Consumer Power: Unsurprisingly, the discussion also turned to consumer values and trends. Various panelists underscored the power of the consumer, especially against the now-familiar backdrop of social media campaigning.  Erika Karp of UBS eloquently observed the potential for a “tiny pause” in consumers’ decision-making in the grocery aisle—replicated many millions of times—to have a massive impact on a brand’s bottom line.

• Investing in the Future: Beyond the covenant between brand and buyer, a few panelists highlighted the utility of the scorecard in influencing the next generation of global institutional investors.  Erika Karp pointed to the $34 trillion global wealth transfer underway and to the fact that the young global elite are increasingly concerned with sustainability issues. It turns out that the new jet-set seem increasingly likely to take a high-speed train instead of a private plane to get from London to Paris or from Beijing to Shanghai.

• Small-Scale Farmers: Jane Nelson of Harvard set off a good discussion about corporate responsibility and the role of smallholder farmers.  Their challenge, she argued, is not exploitation but rather exclusion, in that the vast majority of such farmers are not part of a global value chain. Panelists pointed to the role of NGOs in building smallholder farmer capacity, and also to that of companies in deploying technologies and techniques to empower small-scale farmers to compete.

#7 Constructive Criticism

Of course, Oxfam fielded a few questions about the scorecard methodology and a few critiques of the overall approach.

Jane Nelson was most vocal about limitations, speaking to: 1) the limits of what companies can do to address capacity issues of smallholder farmers; 2) the challenge of transparency and the unfairness of suggesting a “veil of secrecy”; and 3) the need to look beyond competitive scorecards to collective responses.

Erika Karp spoke of the importance of moving beyond the “blunt instrument” of a scorecard to shared, objective measures for assessing company performance and to a “common language” between stakeholders.

Puvan Selvanathan of the UN Global Compact urged Oxfam to distinguish clearly between a company commitment and a company policy, akin to the difference in politics between a campaign promise and a statute. He also hopes to see “some green” on the scorecard over time.

Along with Oxfam colleagues Chris Jochnick and Erinch Sahan, Ray Offenheiser stated that Oxfam will continue to modify and potentially expand the scorecard, suggesting that the effort would not be a “one-off.”

#8 Responses from the Food Companies

Oxfam was pleased to have an impressive showing at the event by more than half of the “Big Ten” in the Behind the Brands scorecard: Associated British Foods, Coca-Cola, Danone, Nestle, PepsiCo, and Unilever. A number of their representatives offered comments welcoming the scorecard and its close examination of newer frontiers such as gender and land rights. Some companies pointed out that there is collective action underway to address key sustainability issues, while others acknowledged the need for future action on emerging issues.

#9 A Way Forward

Picking up on Jane Nelson’s call for collective action to address systemic issues, Ray challenged companies to advocate jointly for government investments in foreign aid to restore once-robust national agriculture programs and extension services. He identified “an opportunity for alliance,” with collective action by the companies, and perhaps also by NGOs, toward the policies of governments and of agricultural traders. By way of historical example, Ray cited the “corporate statesmanship” of a group of American CEOs in jointly promoting the Marshall Plan to rebuild European markets after World War II.

#10 Merging “Long-term-ism” and “the Fierce Urgency of Now”

Erika Karp pointed to the need for companies to shed the yoke of quarterly earnings reports and consider the long term.  Apparently, the CEO of mining giant BHP Billiton declared it “the happiest day of my life” when his company no longer required such frequent reporting.

But to many nodding heads on the panel and in the audience, Karp also echoed MLK Jr. by speaking of the “fierce urgency of now” and of the “unprecedented consciousness” enabled by today’s technology, knowledge, institutions, and activism.

Indeed, there’s no time like the present for the Big Ten companies to lead.

The President’s State of the Union address last night contained a lesser announcement of the launching of a US-EU free trade agreement:

“And tonight, I am announcing that we will launch talks on a comprehensive Transatlantic Trade and Investment Partnership with the European Union – because trade that is free and fair across the Atlantic supports millions of good-paying American jobs.”

This idea has been floating for some months, pushed more from the European side than the US. The US and EU are already massive trading partners with mostly low tariffs and few serious trade disputes.  Nonetheless, making a trade marriage of it has hurdles.  The crux of the US-EU deal will be regulatory and ‘behind the border’ issues.  For example, both the US and EU have extensive farm subsidies and have been critical of one another.  Europeans have some regulatory measures that US exporters see as problematic. (Think GMOs.)

The question is—do developing countries have a stake in this?

The answer is—they could.

What if both sides committed to embracing the pro-development trade policies of the other to harmonize and improve the trade opportunities for poor countries?  The US has a handful of “trade preference” programs that offer special access to developing countries, like the Generalized System of Preferences (GSP), the African Grown and Opportunity Act (AGOA), and regional programs for the Caribbean and Andean countries.  The Europeans have the “Everything But Arms” initiative that offers free export access to least developed countries.

Each side has some pros, and also some cons.  Very broadly, the European program is broader (more products included) and more generous (zero tariffs) than anything the US offers.  But the US programs,  especially AGOA, offer more favorable “rules of origin,” which help poor countries export more complex products like garments, rather than being stuck exporting low-value commodities and products.

Neither the US, nor the EU provide full “duty-free, quota-free” access for all least developed countries (LDCs), which has been a key goal for development advocates in the long-stalled Doha Round trade negotiations.  In fact, LDCs have not seen any of the promised outcomes from the so-called “development round” of the World Trade Organization.  Their request to extend the soon-to-expire exemption to implement intellectual property rules for LDCs has failed to gain support from the US in particular.

If the US and EU want to demonstrate global leadership and do something very positive for the world, they could start by using the trade agreement negotiations to start a “race to the top” in creating economic opportunities for poor countries.

Trade can be an engine for development if its benefits reach those living in poverty. Oxfam has argued for this for more than a decade. Philip Stevens of the Emerging Markets Health Network, in a Wall Street Journal Asia op-ed at the end of last year, calls this “NGO scaremongering.”

Stephanie Burgos, Senior Policy Advisor for Trade

Stephanie Burgos, Senior Policy Advisor at Oxfam America, responds in this letter to the editor.

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The TPP Would Be a Bitter Pill

Philip Stevens’s diagnosis of the Trans Pacific Partnership Agreement and Oxfam’s perspective on it (“Free Trade is Good for Health” op-ed, Dec. 18) is plain wrong.

Oxfam has long been a supporter of trade for development and economic growth, provided rules are fair for rich and poor countries alike. The Trans Pacific Partnership Agreement (TPP), however, only favors multinational drug companies through new intellectual property (IP) rules at the expense of the health of millions in developing countries.

Generic competition, which begins when monopoly protection for medicines expire, is the way countries can reduce medicine prices. New IP rules delay generic competition and thus low-cost medicines in developing countries. Poor people go without treatment or make dire economic sacrifices.

The World Health Organization’s list of essential medicines avoids recommending patented medicines, despite their public health value, because they are too expensive. Mr. Stevens cites the list as evidence that patents don’t matter, when it is precisely a testament to the unfairness of excessive IP rules. Suggesting that developing country patients should be satisfied by access to a limited range of older treatments is outrageously unfair.

Mr. Stevens defends data exclusivity because it generates profits for drug companies, but fails to mention its negative impacts on public health. Oxfam’s research in Jordan, which introduced data exclusivity in 2001 under a U.S. trade agreement, showed the measure significantly contributed to a 20% increase in medicine prices. Other rules demanded by the U.S. will also invite abuse of the patent system by drug companies, tie the hands of governments who want to negotiate prices with drug companies, and distract drug regulators from focusing their efforts on ensuring the safety of medicines.

Intellectual property rules must be calibrated to ensure incentives for innovators are balanced with broader public interests. The IP rules proposed by the US in the TPP upset this balance. This is not a matter of perception. It is right there on paper at the negotiating table.

Five years ago, the U.S. revised trade agreements with Peru, Panama and Colombia to limit the damage the agreements could wreak to public health, but deep-pocketed special interests are now holding the U.S. back.

Here’s to hoping that won’t be the case in 2013.

Rohit Malpani is a campaigns advisor at Oxfam and leads the organization’s access to medicines campaign. Oxfam’s response to Progressive Economy’s “Trade Fact of the Week” 11/28/12 is cross posted from the Progressive Economy blog.

Oxfam disagrees with the analysis set out in your November 28 article about patent protection for medicines. The article incorrectly explains the TRIPS Agreement, and we do not believe there was ever a global consensus in support of the intellectual property (IP) approach promoted by USTR, as implied in your article.

The TRIPS Agreement sets out minimum standards for IP protection, and explicitly includes a series of exceptions and limitations to IP rights that may be used by governments in order to achieve public policy objectives, including improvement of health outcomes. We have long been puzzled by efforts to portray compulsory licensing as a legal tool that may only be used during health “crises” or “emergencies”. Put simply, this interpretation is unsupported by the text of the Agreement itself. Similarly, the Doha Declaration confirms the right of countries to use all IP flexibilities in TRIPS “especially”—not “only”—in relation to health emergencies and pandemics.

We question the “policy calm” that you state has existed for 10 years in relation to patented medicines. In fact, that “policy calm” has never existed. Instead, there have been on-going tensions due to the endless efforts of the USTR, under pressure by the multinational pharmaceutical industry, to renegotiate the terms and conditions of the TRIPS Agreement through other means, and especially to strip away the public health limitations and exceptions that were included in the TRIPS Agreement in 1994. Developing countries are finding increasingly that they must endure against these tensions and challenge the pressure because many patients in their countries cannot obtain the medicines they need – especially newer treatments that are still under patent protection, which tend to be out of reach. Certainly governments in poor countries should allocate more money to health care, but the exorbitant prices of many patented medicines, an increasingly familiar problem in the United States, are an absolute barrier to health care coverage in resource-deficient countries.

Together with other humanitarian groups, we have documented a persistent, severe lack of access to new treatments and quality health care across developing countries, with the lowest income groups most affected. Upgrading health infrastructure is a crucial part of the solution, as is use by governments of all the policy options available to them, including IP flexibilities, to promote the availability of quality, low-cost versions of new treatments for their populations.

Medicines, including but not only “essential medicines” as identified by the WHO, are an important component of healthcare. Depending on their affliction, patients need access to quality, effective treatments regardless of whether these are on the WHO essential medicines list (EML). Moreover, medicines are selected for inclusion in the EML based on a range of factors, including affordability; because patent-protected treatments are more expensive, they are generally not included in the list. This is a critical flaw in the papers cited in your analysis, which found—unsurprisingly—that many medicines on the EML are off-patent.

Health care also does not only refer to AIDS, TB and malaria. To say that India has a “relatively small patient population” with cancer and other non-communicable diseases is wrong. Today, the World Health Organization notes that 80 percent of all non-communicable diseases (cancer, heart disease, diabetes) are in low-income countries, especially as life-styles and eating habits undergo a dramatic shift. By some projections, there are up to 2.5 million cases of cancer in India today. Likewise, by 2025, India will have over 75 million cases of diabetes. These are not problems which can be addressed through charity and insurance. They require serious, Marshall-Plan like investments by governments to both prevent development of these diseases and, inevitably, to provide treatment to ensure that their own citizens can lead healthy lives.

Improving health outcomes in the developing world will require substantial investments in health infrastructure, services, and medicines. At the same time, we urge governments to use policy tools available to them to promote availability of quality, effective treatments at the lowest possible cost.