Dubai Counterfeit Fight Pales Beside Global Inaction

Last year the Gulf emirate of Dubai seized 1.6 billion dirham ($437 million) in counterfeit goods—a signal that the trading center has shed its reputation as a hub for illicit merchandise.

Yet Dubai’s local victory belies the runaway scale of counterfeiting and piracy at a global level, which, despite the best efforts of the private sector, governments, international governmental organizations and NGOs, is a problem that is getting worse, not better.

A new report from economics research firm Frontier Economics, commissioned by the International Trademark Association (INTA) and the International Chamber of Commerce’s Business Action to Stop Counterfeiting and Piracy, reveals the pervasive nature of counterfeiting and digital piracy.

According to Frontier Economics, if this trend is left unchecked, the total value of counterfeit and pirated goods could reach a staggering $2.8 trillion by 2022.

The report, which builds upon earlier work by the Organization for Economic Cooperation and Development (OECD), also assesses the broader socioeconomic impacts of counterfeiting and piracy using data-driven econometric modeling.

These additional costs include displaced economic activity, reduction in investment, fiscal losses and criminal enforcement. Taken together, these costs could amount to $1.9 trillion by 2022. Frontier Economics says the consequential effect on jobs would be profound. It estimates 4.2 million to 5.4 million jobs could be lost by 2022.

Still, there is a more immediate impact. This year a percentage point reduction in the intensity of counterfeiting and piracy would be worth $30 billion to $54 billion in the 35 OECD countries, Frontier’s calculations suggest.

The headline-grabbing figures and depth of analysis contained in the report are likely to be a clarion call to stakeholders and something INTA hopes will force a reaction. “Rapid growth in counterfeit trade means it’s vital for governments to step up enforcement of intellectual property rights and for the public and private sectors to increase their engagement on this issue, as well as their support of government efforts,” says INTA CEO Etienne Sanz de Acedo.