Monday, October 03, 2011

The anatomy of deviant globalization

It is well known that Cyprus is one the epicenters of deviant globalization. Located on the periphery of the European Union — in all senses: geographic, moral, economic, political, etc. — Cypriots are in a perfect position to offer all sorts of "arbitrage" services, from financial arbitrage, e.g. off-shore tax havens (and its deviant twin, money laundering) to climate arbitrage, e.g. tourism (and its deviant twin, human trafficking). But one other realm of arbitrage, which I didn't know about, is Cyprus's position as a provider of globalized medical services, particularly, fertility services.

This description of Cypriot market-making for human eggs, from Scott Carney's superb The Red Market: On the Trail of the World's Organ Brokers, Bone Thieves, Blood Farmers, and Child Traffickers, is a textbook description of how deviant globalization works, at bottom, via moral arbitrage:
Cyprus has more fertility clinics per capita than any other country, making it one of the most highly egg-harvested locations on the planet. Whether licensed or unlicensed, they offer IVF as well as a range of fertility services, even some that are typically proscribed elsewhere, like selection. The fertility business here blends the shady netherworld of gray market financial transactions with the commercialization of human tissue. People travel here from Israel, from Europe, from all over the world. Couples who want a child can find cut-rate help here; while poor women find a market for their eggs. Cyprus is an egg-bazaar that capitalizes on both sides of the supply-and-demand equation. Internationalization has made oversight laughable.
As Carney tells it, the Cypriot fertility market began with the recognition that its peripheral position within "Europe" put it in a good position to exploit gaps in the global regulatory apparatus regarding a repugnant market, in this case, the market in human fertility. With the benefit of local governmental "benign neglect," medical entrepreneurs (not just Cypriots, actually) set themselves up as a broker and arbitrageur for would-be donors (mainly from Russia and the Ukraine) and eager buyers (mostly from Europe, who want "whiter" babies, and Israel, which recently banned the sale of human eggs).

The sting to this classic deviant globalization story, as usual, is in the tail: while this fertility market began as a deviant globalization pure-play, over time, it began to spill over into the local economy. Set up at first to meet global demand with imported supply, local fertility clinics began to draw on "local talent." The result is that, by now, 1 in 50 eligible women donate eggs annually in Cyprus (compared with 1 in 14,000 in the US, for example). Of course, the irony is that these "local" donors are usually also Russian and Ukrainian women, who have arrived in Cyprus for, ahem, other reasons.