Way forward for the WTO

The World Trade Organization holds a public forum annually on a topical subject. The forum attracts a wide spectrum of persons from international agencies, research, academic fields, NGOs, civil society, etc. The topic for this year’s public forum held in late September was ‘Is Multilateralism in Crisis?’

In effect, the question meant, are agencies such as the WTO representing almost all corners of the world with 157 members and other agencies dealing with multilateralism facing a crisis? In the light of the continuing deadlock in negotiations in over a decade old Doha Round, which has been a leading activity in the WTO, the forum was an opportunity for the international society to take stock of the WTO and the new world order in which the WTO operates.

Multilateralism

It provided an opportunity for participants to analyse whether multilateralism is indeed in a state of crisis, taking into account both the Doha Round deadlock and the other activities of the WTO that continue to work well. These include trade monitoring, administering existing WTO rules, and trade capacity building for developing countries.

The WTO Director General, when asked for a comment on the future of multilateralism, had said that he was ‘cautiously pessimistic’ and added that the current multilateral structures have not had time to adjust to the speed with which globalisation had taken place.

Noting that global power has shifted in the last few decades with the developing countries becoming more vocal and taking a more active role in negotiations, he had said that the current multilateralism fitted the situation 20 years ago. Comparing the system to a computer, he had also said that the “hardware” of multilateralism was sufficient, but needed a “software upgrade” and that the developing countries need to be involved in writing the code of the new “software”.

It is apparent that the reputation of the WTO as a focal point of multilateralism has taken a beating due to the impasse in the Doha Round negotiations. But the fault does not lie solely with the WTO as the WTO is not a direct negotiator, but more of a facilitator. The inability of participants to find common meeting ground has caused the deadlock in the negotiations.

Adapting fast to changing times

However, while this does not paint a gloom and doom picture for the WTO which has done excellent work, particularly in capacity building of developing country officials, has a good dispute settlement mechanism which has been a model for many bilateral and regional free and preferential trade agreements and has been a good global trade monitoring body, there is a definite need for the organisation to take a hard inward look at itself to envisage how to adapt fast to changing times.

Even though bilateral and pluri-lateral trade agreements keep on proliferating, the spaghetti or noodle bowl effect they create can lead to confusion. In such a situation, the WTO as the largest single entity with global membership could have played a prominent role in centralising tariff liberalisation, had the Doha Round been successful.

Time to gear up

If the WTO does not equip itself with new ‘software’ as the Director General of the WTO suggests, there is a possibility of various other intergovernmental agencies without such global membership wanting to take on more prominent roles in trade liberalisation. If that happens, non members of such organisations might be in a position to be adversely affected. As such, it is important for the WTO to continue to be the leading organisation to monitor international trade.

The WTO now needs to pay greater attention to new global developments such as food security, trade in natural resources and their impact on environment, issues concerning developing countries, some of whom are on the threshold of becoming developed countries, the diminishing role of the once powerful developed countries who used to dictate terms in previous negotiation rounds, etc. Obtaining a wide range of views through a public forum is definitely the way forward for the WTO to gear itself to move with changing times.



(Manel de Silva holds an Honours Degree in Political Science from the University of Ceylon, Peradeniya and has engaged in professional training in Commercial Diplomacy at ITC and GATT. She has served as a trade diplomat in several Sri Lankan Missions overseas and was the first female Head of the Department of Commerce as Director General of Commerce.)