In January, the United Nations Conference on Trade and Development presented a report on intellectual property rights and their potential for economic development. The report was titled Harnessing Intellectual Property Rights for Innovation, Development, and Economic Transformation in Least Developed Countries. At IP Consultores, we understand that intellectual property rights can enhance the economic and social development of the Americas and the Caribbean. For this reason, promoting an equitable culture of intellectual property rights has been one of our goals since the beginning of this initiative.1
Intellectual property is an economic asset that has the potential to either reduce or widen inequality gaps. In this sense, intellectual property rights are fundamental in developing innovation, entrepreneurship, and creativity ecosystems. These ecosystems impact critical sectors where the most relevant economic transformations occur today. For this reason, innovation and technological development are two fundamental economic pillars that must be developed and leveraged by all social actors.2
Intellectual property is an economic asset that has the potential to either reduce or widen inequality gaps. In this sense, intellectual property rights are fundamental in developing innovation, entrepreneurship, and creativity ecosystems.
Between February 21st and 23rd past, at IP Consultores, we organized our first online seminar to discuss the UNCTAD 2024 Report. This report is crucial as it provides accurate data for formulating effective public policies on intellectual property. The considerations outlined in this study also allow for pathways to be drawn for the development and economic improvement of Least Developed Countries. In this regard, we present the report’s recommendations below to contribute to its dissemination among the Spanish-speaking audience.
UNCTAD and the Least Developed Countries
The United Nations Conference on Trade and Development (UNCTAD) is an intergovernmental body of the General Assembly established in 1964. This agency reports directly to the General Assembly and the Economic and Social Council (ECOSOC) and belongs to the United Nations Development Group. UNCTAD aims to “support developing countries in accessing the benefits of the globalized economy in a fair and effective manner.”3 Additionally, it “provides assistance to help them use trade, investment, finance, and technology”4 to achieve inclusive and sustainable development.
In 1971, the UN designated Least Developed Countries as having widespread poverty and economic, institutional, and human structural weaknesses.5 Nowadays, for a country to be considered least developed, it must have 1) a per capita income percentage lower than USD 1,018, 2) a low score on the Human Assets Index, and 3) a high score on the Environmental Vulnerability Index.6 The UN Economic and Social Council‘s Committee for Development Policy has identified 46 countries as least developed. The total population of these 46 countries comprises approximately 880 million people, representing 11% of the world’s population.7
Between February 21st and 23rd of this past year, at IP Consultores, we organized our first online seminar to discuss the UNCTAD 2024 Report.
The report was based on two documents: 1) UNCTAD, Revisiting Development Innovations in Least Developed Countries: A Practical Review of Selected Intellectual Property Rights Measures (2023) and 2) PENGELLY, Graduating with momentum: IPR-related issues, challenges, and opportunities for LDCs (2024).8 The study aims to determine how Least Developed Countries can develop intellectual property systems to accelerate innovation, growth, and structural transformation. The report considered four sectors that drive the development of intellectual property rights: mining, pharmaceuticals, tourism, and financial services.
Strategic Protection of IP Rights
Improving the intellectual property system in Least Developed Countries makes investment ecosystems more attractive to multinational firms. Foreign Direct Investment is one option that strengthens when effective intellectual property protection systems are ensured. For example, in the music industry, copyright guarantees investors to finance various musical products through investment funds. Another example is loans for Micro, Small, and Medium Enterprises secured by their intellectual property rights.
In this regard, each intellectual property right plays a specific role in financing in least-developed countries (LDCs). Obtaining patents in LDCs is crucial because, in this way, inventors can attract funding to develop their inventions. While utility models protect improvements in the functional aspect of products, they play a fundamental role in financing local products. Industrial designs (the ornamental aspect of a product) contribute to the reputation of brands, which results in consumer loyalty.
At IP Consultores, we understand that disseminating the UNCTAD 2024 Report will result in a better strategy for fostering a global culture of intellectual property rights.
Regarding registered trademarks, their holders can obtain significant profits by paying royalties for authorized use by third parties. In least-developed countries, geographical indications are quintessential rights as they base their economies on agricultural and artisanal products. Copyrights are also necessary as, between 2002 and 2020, the export of all LDCs increased up to 17 times. On the other hand, protecting genetic resources is crucial in Africa as it allows control over access to plants, animals, and microorganisms.
IP Rights for Innovation and Development
According to the report, mining is the primary economic sector for developing intellectual property rights. Over three-quarters of the Least Developed Countries were classified as dependent on commodities. Between 2018 and 2020, “60% of their exports consisted of commodities”9 of which were derived from mining activities related to metals and fuels. While the report mentions the case of PETRONAS (a Malaysian oil company), this category exemplifies a case from Chile.
Regarding the pharmaceutical sector, it is in Bangladesh where an industry has been promoted, reaching a market of approximately $3 billion. According to the Bangladesh Association of Pharmaceutical Industries, more than 1,200 products have been developed in the last two years. Most of these products (around 60%) are exported to developing countries such as Afghanistan, Kenya, Myanmar, the Philippines, Sri Lanka, and Vietnam. Bangladesh’s industrial policy and a series of measures promoted by the international intellectual property system have made this case successful.
Some recommendations
The concluding part of the UNCTAD 2024 Report on intellectual property rights consists of four recommendations. One of the initial conclusions is that the 46 Least Developed Countries must substantially improve their productive capacities to diversify their economies. Likewise, innovation and technological advancements can be crucial in building productive capacities in the LDCs. It is because digitization and new technologies have completely changed the dynamics of production, trade, and development worldwide.
The first recommendation concerns the strategic incorporation of intellectual property protection, considering local needs and specific circumstances. In LDCs, patents, utility models, copyrights, industrial designs, trademarks, and geographical indications should be considered. Awareness of intellectual property rights and their implications is fundamental for guiding national systems toward innovation. LDCs must develop the capacity to design and manage intellectual property systems suitable for their contexts to build reliable regimes.
The third recommendation relates to the fact that a considerable portion of innovation in Least Developed Countries occurs in informal economy sectors. In this sense, formal intellectual property rights protections could be more suitable due to their high costs.
The second recommendation involves expanding technology transfers from developed countries and international organizations to the Least Developed Countries. In this regard, consideration should be given to the United Nations Technology Bank to adopt (and adapt) new technologies in local environments. The third recommendation relates to the fact that a considerable portion of innovation in Least Developed Countries occurs in informal economy sectors. In this sense, formal intellectual property rights protections could be more suitable due to their high costs. Other factors hindering such protection include lacking skills, weak infrastructures, limited access to information, and financing.
Finally, the last recommendation includes innovation policies to promote the Least Developed Countries. According to the report, a specific measure to incorporate this recommendation would be for ECOSOC to include an indicator of technological capacity and innovation in the WIPO Global Innovation Index. This measure would include all least developed countries, as currently, only 21 are considered. At IP Consultores, we understand that disseminating the UNCTAD 2024 Report will result in a better strategy for fostering a global culture of intellectual property rights.
- About this first online seminar, I want to thank those who showed interest in participating in it, and particularly my colleagues Lister NYATZANSA, Mercy CHIWAYA, Regis CHIRENGA, and Sajjad ATAEI who, through their active and purposeful participation, contributed to a better reflection on intellectual property rights in the Least Developed Countries. ↩︎
- Cf., IPKeyEU, SMEs and Intellectual Property: how to escape the middle-income trap, February 15, 2024, https://cutt.ly/7w0agQwT website consulted on March 10, 2024. ↩︎
- UNCTAD and Commonwealth Secretariat, “Harnessing Intellectual Property Rights for Innovation, Development and Economic Transformation in Least Developed Countries,” United Nations, USA-UK, January 2024. ↩︎
- Ibid. ↩︎
- United Nations, Conferences | Least Developed Countries, Background, https://cutt.ly/Vw15BTlu website consulted on March 10, 2024. ↩︎
- According to the Office of the High Representative for the Least Developed Countries, Landlocked Developing Countries, and Small Island Developing States, the Least Developed Countries are Afghanistan, Angola, Bangladesh, Benin, Bhutan, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, the Democratic Republic of the Congo, Djibouti, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Lao People’s Democratic Republic, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Myanmar, Nepal, Niger, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Sudan, Timor-Leste, Togo, Tuvalu, Uganda, United Republic of Tanzania, Yemen, and Zambia. ↩︎
- United Nations, Conferences | Least Developed Countries, What are Least Developed Countries? https://cutt.ly/Vw15BTlu webpage consulted on March 10, 2024. ↩︎
- UNCTAD and Commonwealth Secretariat, op. cit., note 1. ↩︎
- Ibid. ↩︎
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