While international trade is facing one shock after another, with challenges to free trade rules governed by the World Trade Organization (WTO) since its creation in 1995 by the American president, and goods being used as a tool of geopolitical pressure in the Middle East, the World Trade Organization will convene its 14th ministerial conference from March 26 to 29 in Yaoundé, Cameroon. The meeting will be attended by trade ministers from 166 countries.
The organization acknowledges its limitations, with one of the main discussions at this ministerial meeting focusing on its own reform.
“It’s reform or die,” said Peter Sølvberg, the Norwegian ambassador to the WTO who has been tasked with collecting the opinions and proposals of all countries over the past year. In a synthesis document he published in December, Sølvberg warned that the goal is not to create a WTO capable of solving all current or future trade issues, but to make the organization more targeted, relevant, and responsive.
Among the proposals is a consensus decision on how to overcome blockages in negotiations. Currently, decisions are made by consensus, which is not unanimity but rather a veto system where one country’s opposition can prevent a decision from being made. This system has led to lengthy negotiations with the risk of rendering the WTO ineffective.
One potential solution is to keep the consensus decision-making process but with more flexibility and safeguards in place. This approach would allow groups of countries to move forward together until all are ready to agree. The European Union has been a proponent of this approach by applying variable geometry agreements internally.
To prevent blocks caused by domestic political motives, a principle of “do no harm” is being considered as one safeguard to ensure decisions do not worsen the situation for others. India, in particular, has a history of using political vetoes and is threatening to block the WTO reform process.
Another area being addressed is the issue of subsidies and public assistance. Transparency is crucial, with many countries failing to notify aid to the WTO, including China. The idea is to incentivize transparency and focus on the actual harm caused by these state measures.
While the problems are clearly identified, the causes and solutions are subject to debate. Nevertheless, the task at hand is significant, as failure to adapt to globalization’s changes could solidify the WTO’s incapacity to evolve.
