Katherine Tai’s First Big Trade Policy Test

Simon Lester

President Biden’s U.S. Trade Representative, Katherine Tai, has been in office for about six weeks now. In the coming months, she will have some big issues to sort out, many of them the legacy of President Trump’s aggressive and protectionist trade policies. Among other things, she will have to develop an approach to WTO reform; decide whether to pursue new trade agreements; and come up with a new way to address China’s trade practices. (No doubt all of this decision‐​making will put a dent in her popularity, as there is no way to please everyone). It remains to be seen just how the Biden administration’s protectionism will compare to the Trump administration’s protectionism: More, less, or just different in nature.

In the meantime, Tai’s first big test is the role of international rules on intellectual property as they relate to the production and distribution of COVID-19 vaccines, and in particular whether a waiver of WTO patent rules would help here. On Friday, the Washington Post explained the issue she is confronting as follows:

The growing pressure over patent protections has emerged as an early test for Tai, the new U.S. trade representative, who is expected to soon make a recommendation to the White House about whether to support waiving some of the requirements overseen by the World Trade Organization’s Council for Trade‐​Related Aspects of Intellectual Property Rights, or TRIPS.

Tai told a World Trade Organization virtual conference this month that “the highest standards of courage and sacrifice are demanded of us in times of crisis. The same needs to be demanded of industry” — a comment widely interpreted as a signal that drugmakers should brace for a waiver recommendation.

But officials familiar with Tai’s thinking said the trade representative was committed to hearing all sides, noting that she held conversations this week with leaders of companies that hold patents on vaccines as well as with experts like Gates. Tai also is exploring whether there might be ways to boost global vaccine production without waiving the requirements altogether, such as by having WTO member nations use emergency powers to produce patent‐​protected products.

In some recent remarks on this issue, Tai seemed to want to blame “the market” for these problems, saying: “We hope to hear more today about how the market once again has failed in meeting the health needs of developing countries.” Blaming the market here seems to me to be more politically reflexive than evidence‐​based, but putting that aside, figuring out how to ramp up vaccine production and distribution is clearly a challenge.

As my colleague Jim Bacchus has explained, the waiver of WTO intellectual property rules may not be necessary here, so it was reassuring to read in the Washington Post piece that “Tai also is exploring whether there might be ways to boost global vaccine production without waiving the requirements altogether.” It has been difficult to get a good sense of the facts on this issue, in particular how many factories around the world could make the vaccines and how much production know how would have to be provided to them in order to get them up and running.

But if there are factories in developing countries that could make the vaccines, it seems worth facilitating arrangements between the pharmaceutical companies who developed the vaccines and these factories so as to allow for greater production. Such agreements already do exist, and more along the same lines would be helpful as we try to vaccinate the world, and then keep it vaccinated with subsequent booster shots.