#83, The G|O Briefing, January 27, 2022
Sanctions on Putin could cripple International Geneva - A new European push to move forward on a IP waiver for Covid-19 vaccines - The ECOSOC decoded!
This is an onsite, slightly edited republication of the complete G|O Briefing newsletter
Today in the Geneva Observer: Could a Russian president under US sanctions be banned from returning to Geneva? Even if the scenario reads like absolute fiction, possible personal sanctions imposed by Washington on Vladimir Putin, should he move on Ukraine, would cripple International Geneva and have a potentially devastating effect on the city as a whole. We sketch them today in The Geneva Observer. We also report on a concerted European push, spearheaded by France, to find a way out of the impasse in the thorny problem of an IP rights waiver for COVID-19 vaccines. And we talk to the author of The ECOSOC Handbook, A Practical Guide to the UN Economic and Social Council. Mighty useful—and free to boot, courtesy of its publisher, the Swiss Government. That, and more, is all below.
US AND WESTERN SANCTIONS AGAINST VLADIMIR PUTIN COULD BE DISASTROUS FOR GENEVA
By Philippe Mottaz
Possible sanctions on Vladimir Putin could have serious repercussions for Geneva.
Speaking to reporters on Tuesday, President Biden answered “yes,” when asked whether Washington could consider sanctioning the Russian president personally in the event of an invasion. But if personal sanctions have been imposed before on heads of state or government, targeting the head of a permanent member of the UN Security Council would be an unprecedented move, dangerously upping the ante. It could have highly disruptive consequences for the entire UN—no doubt precipitating a crisis for the organization.
Sanctioning Putin could cripple an already weakened multilateral system. Gone would be the West’s hopes of reviving the Iranian nuclear deal. Serious tensions would immediately flare between Europe, the US, and their allies, just at the moment when there seems to be a sense of unity around their concerted response to the Ukrainian crisis. Western leaders might be hesitant to meet with a sanctioned president, and Putin himself might be restricted in his travels. Aware of consequences such as these, the Biden administration will have to carefully calibrate any sanctions that it might eventually impose on Vladimir Putin in the event of an invasion of Ukraine.
“Should this happen, sanctions against Putin himself will likely be symbolic,” a member of the Geneva financial community, with a deep level of expertise on Ukraine’s and Russia’s economy, tells The Geneva Observer. “His two daughters [widely reported to be living in Switzerland] would be directly impacted.” But the most affected, he tells us, would be “the Geneva-based companies active in the energy sector at the heart of the Russian economy.”
In Putin’s People: How the KGB Took Back Russia and Then Took On the West, Catherine Belton describes Geneva as the “outpost of Putin’s oil wealth.” The meticulously researched book (by the former Moscow Bureau Chief for The Financial Times) documents in detail how Putin, from his early days as a KGB agent in Dresden before the fall of the Berlin wall (and with the help of the Stasi), started setting up a network of companies to transfer millions to Switzerland, Liechtenstein, and Asia. These companies, Belton writes, became “central cogs in the influence operations of the Putin regime”—companies such as Gunvor, which back in the early 2000s was “sinking roots deep into Switzerland,” she writes.
“American and Western sanctions would also have a major impact on Geneva-based commodity trading firms, like Vitol and Trafigura or Norilsk Nickel,” our source tells The G|O. This is due to “the enormous Russian economic footprint here; from the banks who would have to sever their relations with Russian companies under sanctions, to the law firms and the myriad of companies that service them, the cascading ripple effects on the Canton’s economy would be profound.” As our source summarizes, “Jobs would go.”
BOOK MENTIONED IN THIS POST
WITH A WTO DEADLOCKED OVER THE TRIPS WAIVER ISSUE, FRANCE AND THE EU MAKE A RENEWED EFFORT TO BREAK THE STALEMATE
By Jamil Chade
France and the EU are actively engaged in a push to break the impasse over the stalled WTO TRIPS waiver negotiations. They hope the upcoming EU-Africa Summit, scheduled to take place in Brussels on February 17 and 18, will bring new momentum to the discussions. Diplomatic sources tell The Geneva Observer that the response to the pandemic will be at the top of the Summit’s agenda—and will include the IP question. The hope is that an agreement might finally be reached on the patents for medicines, vaccines, diagnostics, and other products in the fight against COVID-19. “At this point, it is too early to talk about an agreement between the EU and Africa,” according to a knowledgeable source, but “a whole range of pragmatic options are being discussed.”
Progress in Brussels during the summit would not, however, end the debate about the TRIPS waiver proposal. Now supported by more than 63 other countries, India and South Africa (the two initial proponents of the IP exemptions still on the table at the WTO) are privately expressing their concerns that the European initiative (spearheaded by France) would undermine their original proposal, and thereby complicate the already fraught negotiations.
Last week, leaving no doubts about the EU’s determination to move ahead, French President Emmanuel Macron offered some clues as to what might be included in the new package. Speaking before the European Parliament, he said: “Firstly, you have to transfer the technology and create the capacity,” adding the caveat that, “by no means, however, would this be a proposal to scrap IP rights.” How, then, would this differ from the June 2021 European proposal that failed to convince African countries—which remains, after the joint Indian-South African proposition, the only official paper on the subject discussed at the WTO? Sources close to the discussions say that the recourse to IP compulsory licenses would be facilitated and broadened. Compulsory licenses are permitted under the WTO TRIPS provisions and can be granted by governments to allow alternative production or importation of a generic version of a patented medical product without the prior consent of the patent holder.
WTO Director-General Ngozi Okonjo-Iweala had hoped for an agreement late last year, but the ministerial trade conference was postponed because of the omicron variant. The vacuum left by the WTO gave the Europeans space to propose a global licensing mechanism, removing barriers to allow technology transfer to Africans and the creation of production hubs on the continent. Their proposal would allow individualized licensing of patents without a blanket waiver.
The upcoming EU-Africa Brussels summit—which was canceled in 2020 due to the pandemic—comes against the backdrop of growing frustration from African countries that insist that the continuing disparity in access to vaccines is having consequences that go far beyond health and is deepening the continent's isolation. A package such as the one pushed by the EU, which includes health-related development aid, would help to strengthen a promising health tech sector on the continent.
Questioned by the G|O, diplomats in Geneva were also quick to point out that a successful EU-African summit would undeniably offer interesting collateral political benefits to France and the EU. For Paris, the initiative coincides with the French presidency of the EU and with Macron's certain quest for a second presidential mandate. If successful, the outcome could increase the French president's visibility and reputation as an international actor.
More broadly, the initiative is seen as having the potential to reconfigure alliances at the WTO and WHO, with the EU reclaiming the initiative and China's influence in Africa checked, a longstanding objective of the West and particularly of France. Beijing has been aggressively practicing its ‘vaccine diplomacy’ in Africa with a promise to deliver one billion doses of its Sinovac vaccine this year, 600 million of them for free. “China has already sent over two billion doses of vaccines to more than 120 countries and international organizations,” Chinese President Xi Jinping reminded his audience at the World Economic Forum via video link last week.
To put things into context, last week, the WHO reminded us that more than 80 countries around the world are still short of meeting the goal of having 40% of their populations protected. Thirty of them are below the 10% target. The EU’s initiative also comes at a time of growing outrage at pharmaceutical companies’ revenue forecasts from vaccine sales. Consultancy company Airfinity forecasts that the vaccine market is expected to reach $65.6B in 2021 and grow to $84.9B in 2022: a 29% growth. (This excludes the Chinese vaccines and market.)
The analysis predicts that the 2022 market will be dominated by mRNA vaccines. “Pfizer/BioNTech is expected to generate $42.7B and Moderna $25.7B. AstraZeneca is expected to be the third largest revenue-generating vaccine with $4.3B, followed by J&J with $3.5B,” Airfinity estimates. “This would make the Pfizer/BioNTech and Moderna vaccines the two best-selling medical products in 2022.”
JUST RELEASED: THE ECOSOC HANDBOOK, A PRACTICAL GUIDE TO THE UN ECONOMIC AND SECURITY SOCIAL COUNCIL. COURTESY OF THE SWISS GOVERNMENT
The handbook will officially be launched tomorrow, Friday 28, in New York, by the Swiss Ambassador to the UN. In advance of its release and online publication, we talked to its author, Johann Aeschlimann, who readily admitted to me at the beginning of our Zoom that “you have to be a bit of a wonk” to read the neatly designed booklet published by the Swiss Foreign Ministry. (Full disclosure: Aeschlimann and I both worked as Washington correspondents in the eighties and nineties.)
PHM: Why should a government publish a handbook on ECOSOC? Isn't that the role of ECOSOC itself?
JA: The Swiss government has a tradition of publishing handbooks, going back to 2010, with A Practical Guide to the UN General Assembly, which still serves as a reference today. Switzerland is the only country to have joined the UN by popular vote, and we see these handbooks as a way to highlight Switzerland’s attachment and commitment to the organization. This book is not about the ECOSOC in terms of what the Council does or doesn’t do; it’s not an assessment of the ECOSOC’s performance. It’s simply a practical guide that tells you how the ECOSOC operates.
Who is the target audience for the handbook?
Our primary audience is people who work with, and in the Council, delegates and diplomats who deal with one aspect or another within the purview of ECOSOC, and of course NGOs—as ECOSOC is the only body where NGOs can have a formal relationship with a UN body. ECOSOC rules and procedures are many and complex often distributed in many different documents. This handbook brings them together in a single brochure. If you consider that a delegate spends four years in New York on average, there is not a lot of time to get accustomed to the institution– perhaps only two years or so to work productively before preparing for the next posting. If we can make life easier for these ECOSOC delegates, we can help them spend less time and effort finding their way and more time working on substance.
ECOSOC is an arena where power politics—and superpower politics—play out. How do you deal with that?
You are right. But I think it is essential to make a distinction between the institution itself, which is our guide’s sole subject, and how different countries use (or don’t use) the ECOSOC to push for their agendas and promote their interests. To draw an analogy with the Human Rights Council in Geneva, it is not the Council’s fault that certain political decisions are taken the way they are. This is simply a result of the power relations in the world.
You may remember our stories (here, here, and here) on the censorship of a WHO report critical of the Italian response to the first wave of the pandemic. Briefly posted by the WHO on its website, then immediately taken down and never republished, the report, while altogether praising Italy’s efforts, described the initial Italian response to the pandemic as “chaotic and disorganized.”
Last week, one of the most authoritative medical and scientific publications in the world, The Lancet, went beyond that qualification. In the piece, ‘Recognising Italy’s mistakes in the public health response to Covid-19’, the authors allude to “institutional omerta” from the Italian authorities, concluding that “the national government and regional government of Lombardy’s decision to not create a so-called red zone around Alzano Lombardo and Nembro (blocking off entry to and exit from the two communes) when COVID-19 was discovered in people at the end of February 2020, is seen to be directly responsible for the spread of infection to other towns throughout the province of Bergamo, particularly the Seriana Valley”—in short, confirming the assessment of WHO’s spiked report.
Particularly interesting also is the concluding paragraph of The Lancet’s piece: “The contribution of anthropologists to documenting and analyzing the social and political effects of epidemiological events has been crucial for other infectious diseases (e.g., Ebola virus disease and AIDS)—for example, in Africa.” The piece claims that “Transdisciplinary research” produces evidence that “is key for institutions to identify and address mistakes in public health response, which is needed to support communities to prepare for future infectious threats, as recommended by WHO’s Community Preparedness Unit.”
In essence, the WHO report written by Francesco Zambon and his team did exactly that. It was an extraordinarily helpful and important document, recognized as such by the OMS. In documenting Italy’s response and sharing it publicly so early in the pandemic, the intention was to help others better respond to this devastating pandemic. And yet, it was Zambon and his team who were made into villains by their own organization—an organization, evidence now shows, whose leadership caved in from political pressure, including from the Italian Government. The Bergamo investigation into the response to the pandemic is expected to end soon. According to Italian press reports, indictments might be forthcoming in the next few weeks.
Today's Briefing: Philippe Mottaz - Jamil Chade
Edited by: Dan Wheeler