The global counterfeit industry is worth $800bn annually, and Dubai is now a key battleground. What can regional policymakers do to prevent fake products from entering the market?
The number of containers that pass through Dubai’s Jebel Ali Port is proudly recorded: more than 13 million annually and rising every year. What is not known is how many of those containers hold illegal fake goods — from copycat watches and clothes to dangerous drugs that claim to be legitimate pharmaceuticals.
In parallel with the rise of Dubai as an international trading hub, where East meets West, the issue of intellectual property (IP) rights across a vast range of industries is also gaining in importance. While the majority of the counterfeit goods originate from Asia and continue on — undetected — to Europe and Africa, merely using Dubai as a stop-over for ships to refuel, the emirate has become a natural thoroughfare for fake products.
The European Union Taxation and Customs Union considers the UAE the second-most common origin point for counterfeit goods that reach its borders, despite its annual report recognising most shipments have likely started their journeys further east. The UAE is the last port of call for more than 8 percent of goods suspected of infringing on intellectual property rights, with perfumes, cosmetics, body care items, cigarettes and mobile phones and their parts and accessories the most common items.
It’s an issue likely to get worse as Jebel Ali grows — it’s already the world’s biggest container port outside East Asia — and Dubai gears up to host World Expo 2020, drawing in countless new traders, foreign investment and tourists. The Expo, awarded to Dubai on 27 November, is the ultimate showcase of ideas and innovation, the very thing that requires strong IP protection.
At the same time, the Gulf countries are working towards diversifying their economies, particularly towards knowledge-based industries, which rely on IP rights.
“The protection of intellectual property... is the cornerstone of attracting foreign investments and establishing a balanced economy — an economy that is based on legitimate competition which brings about benefits to society and the economy, and all consumers, as well,” UAE Ministry of Economy Undersecretary Mohammed Ahmed Bin Abdul Aziz Al Shehhi says.
“This phenomenon... hampers the objectives of a sustainable economy and causes many losses to the economy. It also underlines the efforts of those dedicated to innovation and development because of counterfeit goods, which also deprives consumers of original projects.”
Just how much is lost to the black market financially is anyone’s guess. The chairman of the Brand Owners’ Protection Group in the UAE, Omar Shteiwi, says research values the counterfeit industry at $800bn globally, of which at least $50bn is in the Arab world.
“It’s not getting better; it might [even] be getting worse,” Shteiwi says. “The signs we are receiving from the authorities say that it’s getting better — even the EU Customs are saying it’s getting better — but the signs we’re seeing from the owners [suggest] it’s not getting better.
“Ninety percent of anything you think of [could be] counterfeited. Imagine everything can be counterfeited.”
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