The Trade and Health Link

The COVID-19 Virus, a communicable disease declared a global pandemic by the World Health Organization (WHO), has highlighted the interconnectivity of the world through globalization. Its impact on national and global economies has brought to the fore the critical link between trade and health and the relationship between the WHO and the World Trade Organization (WTO) as well as other trade-related organizations such as the United Nations Conference on Trade and Development (UNCTAD) and the World Intellectual Property Organization (WIPO).

The link between trade and health is not new. Over the years, it became very clear that there was a need for policy coherence between trade and public health issues due to trade in medical products, including pharmaceuticals; trade in harmful products, e.g. tobacco; movement of health personnel; provision of cross-border health services; and the deepening of trade liberalization through bilateral, regional and multilateral trade agreements. Health and trade policies often collide as health policies tend to require trade restrictions, reduced prices, and other concessions for developing countries.

The WHO has observer status at the WTO in the Committees on Sanitary and Phytosantary measures (health standards/regulations for trade in plant and animal products) and Technical Barriers to Trade (standards/regulations for trade in goods e.g. pharmaceuticals). WHO also has ad hoc observer status in the WTO Councils for Trade-related Intellectual Property Rights (TRIPS) and the General Agreement on Trade in Services (GATS).

The WHO has its own mechanism for addressing trade and health issues with the World Health Assembly (WHA) adopting landmark decisions. The WHO Drug Strategy contributed to the adoption at the WTO Doha Declaration on TRIPS and Public Health in 2001. This Declaration recognized the need for developing country Members to use flexibilities in the TRIPS Agreement, related to patents, in the interest of public health. At that time, a major health concern was accessing drugs primarily for the treatment of HIV/AIDS. Later, drugs for non-communicable diseases, such as high blood pressure, diabetes, heart disease, respiratory diseases and cancers were considered. In availability and cost of drugs, this Declaration most likely benefitted Caribbean countries.

Taking account of the rise in non-communicable diseases, in 2003, WHA adopted the Framework Agreement on Tobacco Control to regulate the use and sale of tobacco and tobacco products. By 2010, it adopted a global strategy to reduce the harmful use of alcohol.  Since then, with the added concern about obesity, the WHO has also addressed the use of fiscal measures to encourage reduction in the use and consumption of sugar, salt and fats.

The WHA, in 2006, adopted resolution WHA59.26 on International Trade and Health to promote coherence at the national level among relevant government ministries and at the regional and international levels. Jamaica’s National Foreign Trade Policy addresses coherence between trade and health. In the UN Sustainable Development Goals (UN SDGs), health and well-being is goal 3 recognizing the trade and health link through access to affordable drugs and vaccines.

Currently, international economic organizations are forecasting that COVID-19 will have a severe negative impact on the global economy.  Production has been reduced, businesses closed, events cancelled, and transportation and travel restricted. Already COVID-19 is reported as having a greater impact on the global economy than SARS in 2003 and MERS in 2012. The WTO is assessing that global trade in goods and services will show a further downward trend. COVID-19 is demonstrating that a pandemic can cause economic disruption, slow economic growth, and could trigger a recession. It also requires international cooperation to stem the spread, find a remedy, and stimulate economies. UN SDG 3, should now deal more explicitly with the trade and health connection and take account of the economic fallout from pandemics.

In the Caribbean Community (CARICOM), health issues are addressed in the Council for Human and Social Development (COHSOD) and trade in the Council for Trade and Economic Development (COTED). There have been trade-related health issues which were addressed in COTED. In this current situation, COTED, at its meeting in April, will have to look seriously at the economic impact of COVID-19 in the region and decide on how to more consistently address trade and health issues on its agenda, as well as consider developing a strategy for pandemics.

Submitted by Elizabeth Morgan, Specialist in International Trade Policy and International Politics

Postscript: The Pan-American Health Organization (PAHO) is the regional office of the World Health Organization (WHO)