from Renewing America

The Promising Future of the WTO: A Response from the Deputy Director-General

The WTO faces real challenges, but reports of its death are exaggerated. Here's the path forward.

March 12, 2018

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Alan Wm. Wolff is Deputy Director-General of the World Trade Organization (WTO).

Ted Alden in a Council on Foreign Relations blog post wrote about current trade events under the heading “Trump, China, and Steel Tariffs: The Day the WTO Died”. I have great respect for Ted Alden as a keen observer of trade issues. Nevertheless, I am reminded of the Mark Twain quotation of what he said on his hearing of the publication of his obituary: “The reports of my death are greatly exaggerated.” 

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What are the facts?

First, without commenting on the merits of the actions taken and threatened at present, as those will be ultimately resolved by WTO members, the problems of world steel trade were not unknown before this month. There are well-recognized issues testified to by the number of major international meetings on this subject that have taken place with a heightened level of attention in recent months and over the last several years. Nevertheless, steel issues can be sorted out without the WTO collapsing.

Second, there are serious issues to be resolved as to how appeals can be processed by the WTO dispute settlement system. High-level engagement by the members is needed to resolve the situation. It is certainly too early to conclude that there is no common ground upon which members can agree.

Third, the negotiating function of the WTO is hardly dead. Three major WTO agreements were reached just two years ago at the Nairobi Ministerial Meeting—to expand the Information Technology Agreement, to create a Trade Facilitation Agreement, and to ban agricultural export subsidies. And at this last Ministerial Meeting in December in Buenos Aires, WTO members accounting for three-quarters of world GDP and three-quarters of world trade declared their intention to move forward on a number of areas for improvement in the world trading system, including electronic commerce.

Ted Alden is right to sound an alarm (and an alarm is more effective if vivid imagery is employed) about the serious risks to the world trading system of major players appearing to embrace conflict over working cooperatively together to deal with real problems, but it is far too early to make arrangements for the WTO’s funeral. The seventy-year-old world trading system has a remarkable record of achievement. It saw Europe and Japan through recovery from the ravages of World War II. It proved its resilience very recently during the financial crisis of 2008. At present, there is a line at the WTO’s door of war-damaged countries seeking entry into the WTO in order to improve their economic outlook and give them a better chance for peace.

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There is much yet to be accomplished by the WTO, and plans are in place to do so.


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