Saturday, June 24, 2006

Time to take fake seriously

This week saw another flurry of news on a wide range of fake goods - including a report from Russia on the extent of the problem of fake alcohol, that is estimated to kill 42,000 Russians a year. If fake booze doesn't kill you - the head of a fake golf club flying off, might. This article claims the problem is at epidemic proportions in the US... and gives buyers the usual platitude: if the price is too good to be true, it probably is. How long before the counterfeiters simply charge full price to defeat this technique?? The spectre of counterfeit electronics also made it into the media this week: fake memory cards. Enlightened manufacturers are finally beginning to put unique codes on products that consumers can check.

And finally, some (not new) numbers from the WSJ:

The global economy for illicit goods is massive, but by definition impossible to measure. What we do know is that it is getting bigger. The number of counterfeit items seized at European Union borders has increased by more than 1,000%, rising to over 103 million in 2004 from 10 million in 1998. At U.S. borders, seizures of counterfeit goods have more than doubled since 2001. Even allowing for improved detection rates, there is little doubt that the situation is getting worse. In the 1980s, 70% of firms affected by counterfeiting were in the luxury sector. But in 2004, more than 4.4 million items of fake foodstuffs and drinks were seized at EU borders, an increase of 196% over the previous year. In the U.S., seizures of counterfeit computers and hardware tripled from 2004 to 2005. There are also fake electrical appliances, car parts and toys.

Counterfeit medicines were reckoned to account for almost 10% of world trade in medicines in 2004. A recent study in the Lancet concluded that up to 40% of products labeled as containing the antimalarial drug artusenate contain no active ingredients. Most of these fake drugs are headed for the world's poorest countries. The World Health Organization estimates that 60% of counterfeit medicine cases occur in developing countries.