Bush in Africa: Compassionate Protectionism?
by Mark Weisbrot
July 15, 2003
President Bush's five-day, five-country tour of Africa has had political observers wondering: is this just another photo-op, crafted to show that the President is not just a "bring them on," unilateralist gun-slinger but a "compassionate conservative?" Or does he intend -- for whatever political reasons -- to actually deliver something of substance?
It should be known, first of all, how far the United States and the rich countries as a group are from actually helping the people of Africa more than they are hurting them. If we look at the balance of payments for Sub-Saharan Africa, there is an annual net drain of more than $12 billion dollars out of the region. This is about 4.4 percent of the region's income, one of the highest such transfers from South to North in the world. It is mostly debt service.
In other words, some of the world's poorest countries are transferring a large amount of their income -- even after taking into account the new loans and grants that they get for development assistance -- to the vastly richer North. This includes their biggest creditors, the IMF and World Bank. The transfer is more than these countries spend for health care or education.
This debt should be cancelled, as the most knowledgeable non-governmental organizations have argued.
Even more urgently, Africa is suffering from a horrible plague -- 29 million Africans have AIDS or are HIV-positive. With only about 12 percent of the world's population, the continent has 90 percent (11 million) of the world's AIDS orphans. And about 1.5 million Africans die each year from tuberculosis and malaria.
On the public health front, President Bush has gotten credit for pledging $15 billion over five years to help treat and prevent AIDS in Africa and the Caribbean. But there are doubts about how much of this money is going to materialize, and when. One year ago the Administration promised $500 million for prevention of HIV transmission from mothers to newborn children, but no money has yet been appropriated.
The United States has joined the Global Fund to Fight AIDS, Tuberculosis, and Malaria, and -- in accordance with our income -- could be expected to contribute at least $3.5 billion. But the administration has budgeted only $200 million for next year, less than 6 percent of our share, and $150 million less than the current year.
The Bush Administration's efforts are also corrupted by the influence of the pharmaceutical industry. The big drug companies, backed by our government, have fought tenaciously for years to prevent people in poor countries from having access to more affordable, generic drugs. This is a life-and-death issue for millions of people: the drugs that keep people with HIV/AIDS alive here cost $10,000 per year, but the Indian pharmaceutical industry produces the generic equivalent for less than $250. And it is not just AIDS that afflicts people in poor countries: they also get heart disease, cancer, diabetes, and many other ailments that are common to human beings.
The rich country governments have recently made some compromises at the World Trade Organization on these issues. But the Bush team is trying to split Africa off from the hundreds of millions of people in other developing countries who have similar needs, and they are pressuring other developing countries -- Brazil, the Philippines, the Dominican Republic, and others -- for more concessions to the drug companies.
This costly protectionism -- the opposite of free trade -- is bad for everyone. Africa's interest in this matter is tied to those of other developing countries in a number of ways: for example, the generic drug producers sometimes need the latter's markets for economies of scale, if they are going to provide affordable drugs for the poorest countries.
Americans also have a direct interest in the outcome of this conflict. The same companies that are blocking access to generic, life-saving medicines for people in developing countries are doing similar things on the home front. They have fought for years to keep Medicare from including a prescription drug benefit.
They may have lost that battle, but their monopoly pricing policies are making prescription medicines increasingly unaffordable here. And so are the enormous costs associated with "copycat drug" research and development, advertising and promoting drugs for inappropriate uses, legal costs and other waste involved in the present patent system.
What the Bush Administration decides to do about the health crisis in Africa will therefore affect all of us -- much more than most people know.
Mark Weisbrot is Co-Director of the Center for Economic and Policy Research, a nonpartisan think-tank in the nation's capital. Readers may write him at CEPR, 1621 Connecticut Ave NW, Suite 500, Washington, DC 20009-1052 and e-mail him at Weisbrot@cepr.net