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Brazil Case Discussion

Essay by   •  June 10, 2013  •  Case Study  •  478 Words (2 Pages)  •  1,801 Views

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1.) Are Brazil WTO actions serving the country's long-term economic and business interests?

Brazil's actions into the WTO definitely serve the country's long-term economic goals. In recent years, the country has gained strong vigorous growth with a low inflation rate, which is due to the implementation of sound macro-economic policies. The two-pronged and regional trade agreements, promoted by Brazil, can complement the multilateral system by supporting the integration of the markets, strengthening the role of trade in economic growth, promoting a gain of scales for domestic firms and providing a more extended foundation to deal in the global competition. The excellent economic situation of Brazil is mainly due to a plan based on economic responsibility, income distribution and a system of controlling inflation. I believe the short and long term perspective of Brazil is very promising.

2.) Who is right in the compulsory licensing issue, Brazil or Merck?

I don't believe there is a clear cut answer to this question, but if I had to choose I would have to say Merck. I believe Merck did the right thing by not giving up and continuously responding with counteroffers to Brazil's bids. This resulted in Brazil paying a higher price than they had originally wanted. After all, Merck, like any other company, is out trying to make as much money as they can, and they did this successfully even though it did not come easy. The license was great for Merck because Brazil was ranked one of the world's largest economies at that time. The license guaranteed Merck royalties for 5 years which will make Merck more profitable. Brazil, on the other hand, could have had a better deal by accepting the offers from generic providers because their costs were lower. Brazil ended up having to import a generic version from India for 2 years while Farmanguinhos learned how to manufacture the drug. For Brazil, this was basically a wasted investment for the first two years. At the time, Brazil was working to attract investment in innovative industries that rely on IP, and this move risked investments going elsewhere.

3.) What are the best arguments Brazil and the United States can make to the WTO's dispute settlement body concerning cotton subsidies?

First, Brazil could argue that U.S. subsidies were increasing when they were supposed



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