What are thse USTR Watch lists?

[James Love <love@cptech.org>]

I had a request for an explanation of what the USTR's various
lists and reports.  I'll offer an explanation, and will welcome
other comments on this topic.

The US government has an elaborate system for monitoring global
national economic policies, including policies on intellectual
property.  

Every year the US Government (USG) publishes a "Special 301"
report that purports to "detail the adequacy and effectiveness of
intellectual property protection" in countries throughout the
world. This report is usually announced at the end or April or
the beginning of May.  The Special 301 report on intellectual
property includes information on WTO disputes, "out-of-cycle
reviews" of policies in various countries, and putting countries
on the "Priority Watch List" or the regular "Watch list."  

The USG also publishes an annual report called the National Trade
Estimate Report on Foreign Trade Barriers (NTE)" that surveys
"significant foreign barriers to U.S. exports."  The NTE includes
intellectual property disputes plus everything else the USTR
cares about.  In addition, from time to time the USTR will issue
various press releases and statements about particular trade
disputes.

Generally, a country gets in these various reports and lists by
having laws, policies or practices that the US government (a)
doesn't like, (b) considers important, and (c) is trying to
change through bilateral pressure.

Being on a list itself is considered a trade sanction, because
the US government is advertising the country as an investment
risk.  But in my opinion, the lists are more significant as a
source of information about USG policy.  That is, being on the
list is much less important that the bilateral pressures the USG
applies to countries on the topics mentioned on the list.

Few Americans understand how powerful and feared the USG is in
the global economy. No country can do well economically without
access to the US market, and often without USG support or
cooperation on a wide range on issues.  This is particularly true
for small countries and poor countries.  The USG is a huge
presence in the WTO, the World Bank, the IMF and dozens of
multinational organizations.  The USG makes foreign policy
decisions, gives or withholds economic aid, raises or lowers
tariffs, grants visas, sells technology, resolves dumping cases,
or does a thousand other things that make a difference to foreign
governments.

If the USG wants something from Australia, New Zealand, South
Africa, Zambia or any other country, it has enormous leverage. 
For example, South Africa is negotiating a very sensitive dispute
over steel exports to the USA.  Thailand was in a difficult
position regarding the IMF when the economy collapsed.  China
wants to join the WTO.  India is concerned about the USG position
in its disputes with Pakistan.  Israel receives enormous amounts
of aid from the USA.  Each of these countries are also facing
very difficult trade disputes with the USA over pharmaceuticals.

When the USG puts a country on a Watch or Priority Watch list or
publishes complaints about a country in the NTE, it is also doing
quite a bit on the ground, lobbying a country to change its
policies.  Everything is ultimately linked to everything.  Or, as
one USTR official said, "its about power."  The list is simply a
roadmap to what the USG is using its power for.

In developing countries, being put on a list or being included in
a USG report can make front page news, and there is enormous
pressure on governments to get off the lists.  

When the USTR put South Africa on the Watch List on April 30,
1999, one of the US complaints was that:

"During the past year, South African representatives
have led a faction of nations in the World Health
Organization (WHO) in calling for a reduction in the
level of protection provided for pharmaceuticals in
TRIPS."

Before the report was issued, Dr. Zuma, the Minister of Health
for South Africa, was slated to be a member of a Ministers only
panel discussion at the World Health Assembly on strategies to
deal with HIV/AIDS - with Secretary Shalala.  Secretary Shalala's
staff was very concerned that Zuma would blast the US government
for its trade pressures on compulsory licensing or parallel
imports.  However, after the USTR report was issued, Dr. Zuma
announced she would be campaigning in South Africa, and she was
taken off the panel.  Earlier the South African government had
removed a government member from a panel at a different Geneva
meeting on compulsory licensing.  The official South African
government position was that this had nothing to do with USTR's
April 30 report, but there was wide sediment that the USTR action
has chilled free speech in these international forums.  Most
African countries are quite afraid to be seen as hostile to USG
trade positions, and for good reason.  

My main point is that the list is an indication of pressure, much
more than a sanction by itself.  

 
 Jamie Love <love@cptech.org>

-- 
James Love, Director, Consumer Project on Technology
I can be reached at love@cptech.org, by telephone 202.387.8030,
by fax at 202.234.5176. CPT web page is http://www.cptech.org