Five ways IP can help in a recession
In April this year, the International Monetary Fund projected global growth of 2.8% for the whole of 2023 and 3% for 2024, down from 3.4% in 2022. The slowdown is forecast to be especially pronounced in advanced economies, which are expected to grow at just 1.3%. Some economies (such as Germany and the UK) are projected to shrink in 2023.
Part of the reason for the falloff is the stalling pace of globalisation and reduced trade flows resulting from the COVID-19 pandemic and the conflict in Ukraine. Heavy inflation and energy-supply woes threaten to overburden governments struggling to service debts incurred by lockdown measures, in turn squeezing populations already monetarily depressed.
Writing in the Financial Times in July, David Lubin, head of emerging markets economics at Citi, pointed out that the global dip in goods exchange is now having an impact on investment in emerging markets.
On the other hand, as a category of intangible assets, intellectual property (IP) is less susceptible to these kinds of fluctuations and can offer much-needed stability in financially worrisome periods. As such, those responsible for managing IP portfolios are in a position to help steer through economic squalls, but only if they are properly informed of the strategies available.
IP in times of adversity
A negative outlook means that many businesses and IP owners will be cautious about investing and may be looking to cut costs where possible. Evidence from previous downturns suggests that applications for IP rights fall when the global economy declines, and some IP offices have already reported a drop in trademark applications.
Use of the Madrid System for international trademark filings shrank by 6.1% in 2022, according to World Intellectual Property Organization (WIPO) statistics—its most significant decrease since the fallout of the 2008 financial crisis.
However, there are five key reasons why now is the right time to concentrate on protecting and enforcing IP rights.
1: IP rights are generally a medium-to-long-term asset
Patents last up to 20 years from filing (with extensions possible for pharmaceuticals), registered design rights in the European Union for up to 25 years and trademarks indefinitely (providing they continue to be maintained).
