One salient feature of modern economic growth is what economists call creative destruction. Creative destruction is when agents of the economy innovate or invent new efficient technologies to improve the ways goods and services are produced, thus jettisoning old ones.
But one very important motivating factor of creative destruction is the protection of intellectual property rights (IPRs) of agents of the economy. Over the decades, slack legislations and poor implementation of laws governing the protection of intellectual property may have been the impediment of creative destruction in Nigeria, which may have hampered economic growth and development.
Intellectual property laws protect the interests of creators by giving them proprietary rights (Intellectual Property Rights) over their creations. Infringement of IPRs undermines genuine investment in creativity, innovation and knowledge. Invariably, the granting of exclusive proprietary rights (usually in consideration of the disclosure of the creation), creates an incentive for creators to develop, produce, and distribute new and genuine goods and services for commercial purposes.
Notably, in countries where IPR holders are not protected under a clearly defined and efficiently administered intellectual property legal and policy framework, the economy bears the brunt of such inadequacies in terms of undeveloped potentials, hindered capacity for job creation (direct and indirect) and low international competitiveness. This, together with poor education system, comatose power system and unfavourable fiscal system accounts for stagnant growth of Nigeria’s industrial development.
Reform efforts that are needed to strengthen IPRs in Nigeria will therefore necessarily have to holistically address the challenges identified, in the areas of registration, protection, enhancement and enforcement.
As Nigeria increasingly becomes an important economic hub on the African continent, protection of rights subsisting in IPs created in the country is not only strategic to the nation’s current drive to develop its non-oil sector but also central to its overall economic growth and development goals. Accordingly, there must be initiation of purposeful collaborations, going forward, between the government and the private sector organisations to identify, dialogue, and develop viable solution-frameworks to the problems of IPR infringements in Nigeria.
A very serious challenge facing IPR owners in Nigeria is the lack of an efficient deterrent enforcement system. It appears that reforming Nigeria’s IP legislation alone may not achieve optimum results in protecting IPR holders, except the mechanism for enforcing the law is equally enhanced. Law enforcement agents, particularly the Nigerian Police Force and the Nigeria Customs Service, need to be more empowered to carry out their policing and prosecution functions. Experience shows that insufficient finance, inadequate or obsolete equipment and lack of up-to-date skills in the use of modern technologies among the rank and file of officers, prevent the various efforts being made in combating IPR infringement from achieving desired results.
Not taking necessary action to empower law-enforcement agencies against intellectual property theft have certain negative consequences on businesses and the economy at large.
For example, according to a report by Price Water house Coopers titled: “The Impact of Intellectual Property Infringement on Businesses and the Nigerian Economy,” the Nigerian Textile Industry falls prey to IP infringement.
In that report, the Nigerian Textile Manufacturers Association (NTMA) says Nigeria loses about $325 million to tax evasion and smuggling of textiles annually. The cotton and textile industry in Nigeria was said to be the second largest in Sub Saharan Africa since the 1980s, but practices like copying of designs, counterfeiting trademarks, and falsifying descriptions have since destroyed the industry.
It said of Nollywood, which is the second largest employer of labour in Nigeria, “By 2016, about N239 billion in intellectual property theft was attributable to the film industry.
Nigeria has one of the highest occurrences of piracy in the world. Despite the industry’s contribution to national revenue, the World Bank reports that for every legitimate film sold, nine others are pirated. About 80 per cent of international music CDs available in Nigeria are pirated. In the local industry, 40 per cent of products are copied, counterfeited or sold illegally.
Piracy accounts for 7 per cent of global trade, but Nigeria is home to 80 per cent of pirated international CDs.
The menace also affects the pharmaceutical industry. The report says Nigeria has emerged as the hotspot for the manufacture and trade of fake drugs.
The National Agency for Food and Drug Administration and Control (NAFDAC) attributes the issue to a problematic system and porous borders. Weak pharmaceutical regulation and corrupt officials continue to thwart NAFDAC’s efforts to eradicate fake drugs.
The proliferation of fake and counterfeit medicine has detrimental effects on the economy and on society. Nigeria is estimated to lose about N200 billion annually to counterfeit medicines (including substandard drugs). A market survey by Pfizer found that 40 per cent of the Pfizer medicines in Nigeria are sourced from illicit parallel importation (a form of counterfeiting). A 2011 WHO study found that about 64 per cent of antimalarial drugs in Nigeria were substandard.
The counterfeit and substandard drug distribution network is so expansive that more than 50 per cent of drugs, food and drinks sold in open markets are counterfeit.
There is a dearth of IP cases in the country and this indicates that more effort needs to be made among the sector stakeholders (particularly IP lawyers, judges, judicial bodies, law teachers and law reform commissions, regulatory bodies and the general populace) towards developing Nigerian jurisprudence in this area. This problem is also exacerbated by the inadequacy of competent judges skilled in IP laws in the nation’s judiciary.
There are lessons to be learnt by Nigeria from emerging markets such as China and India, where IP has contributed immensely to the harnessing of talents, development of technical know-how, specialization in the production and exportation of modern technologies and overall growth and development of the economy.
In China, a political declaration was made at the 18th Chinese Communist Party Convention in 2013 which reinforces trade and IP in general and incorporates them into the Chinese national development plan. Prior to this, the nation adopted in June 2008 a National IP Strategy (NIPS) which was later, in March 2011 complemented the 12th Five Year Plan, with the objective of developing China into an innovative country. In pursuance of these objectives, major reforms of the legal and adjudicatory frameworks for IP in China have recently taken place and are still on-going. To this end, three specialised IP courts were created in 2014 in Beijing, Shanghai and Guangzhou.
The progress achieved so far through China’s policy measures have enhanced significantly, the country’s clear national goal of becoming an innovation economy by 2020. That can rightly be deemed successful.
Also, as reported by India in the referred European Commission’s paper, landmark improvements have been noticed in India’s IPR regime; particularly since the country joined, in 2013, the international trade mark system’s Madrid Protocol. There have been major reforms recently in the administration of IPR in India such as the introduction of a “comprehensive e-filing services, customs services’ enforcement, co- operation between various enforcement departments, improved IPR awareness amongst officials, digitisation of the operations of the Indian Patent Office, and hiring of additional patent examiners.”
These efforts have strengthened IPR protection and enforcement in India such that today, Indian police will often take enforcement action on their own initiative where there are perceived or reported cases of IPR infringement while the courts are more efficient and effective in dealing with rights-enforcement suits.
At a time when oil, the nation’s principal source of foreign exchange earnings, is facing a precarious future (dwindling volume of production resulting from decaying and vandalised infrastructure; plummeting international prices and; competing, more efficient, alternative energy sources), the time to transform the nation from a traditional commodities-based and import-driven economy, to a knowledge-economy exporting expertise, talents, value-added products and tech-savvy inventions is now. This accounts for the current national agitation for a developed and self-reliant economy, buoyed by diversification.
Thankfully, modern technology has reduced some of the negative fallouts of loose intellectual protection in the country. For example, hitherto, apart from shows and endorsements, musicians in Nigeria hardly made substantial profits from sale of their songs; ditto for movie makers.
Today, with the online solutions provided from applications such as Netflix, iTunes, Spottify, IROKO Tv, etc., the piracy problem has been reasonably reduced.
So, added to regulations and enforcements, the use of technology should be heftily tapped into in protection against intellectual property crime.
