Counterfeiting has become engrained in the world economy

This study shows that counterfeit and pirated products are being produced and consumed in virtually all economies, with Asia emerging as the single largest-producing region. In recent years, there has been an alarming expansion of the types of products being infringed, from luxury items (such as deluxe watches and designer clothing), to items that have an impact on personal health and safety (such as pharmaceutical products, food and drink, medical equipment, personal care items, toys, tobacco and automotive parts).

With respect to magnitude, the study notes that promising work has been done in a number of sectors to measure the extent of counterfeiting and piracy, but that much more can and should be done. The situation of each industry is unique, therefore techniques for carrying out such analysis need to be tailored to the sectors concerned.

To date, no rigorous quantitative analysis has been carried out to measure the overall magnitude of counterfeiting and piracy. This report notes the difficulties that would need to be addressed before such an estimate could be made, and then presents a methodology for estimating the role of counterfeiting and piracy in international trade, which is only a part, albeit an important one of the total picture.

An analysis of international trade data (landed customs value basis) was carried out using the methodology; it suggests that up to USD 200 billion of internationally traded products could have been counterfeit or pirated in 2005. This amount is larger than the national GDPs of about 150 economies. The figure does not, however, include counterfeit and pirated products that are produced and consumed domestically, nor does it include non-tangible pirated digital products being distributed via the Internet. If these items were added, the total magnitude of counterfeiting and piracy worldwide could well be several hundred billion dollars more