WTO meeting ends in discord, ministers urge smaller-scale trade talks

The World Trade Organization failed to achieve any new agreements on Wednesday, ending a ministerial conference in discord in the face of stinging U.S. criticism of the group and vetoes from different nations.

The stalemate dashed hopes for new deals on e-commerce and curbs to farm and fisheries subsidies and raised questions about the human body’s ability to govern increasingly contested international trade.

The frustrations led some ministers, including U.S. Trade Representative Robert Lighthizer, to indicate that discussions among smaller groups of “like-minded” WTO states were a much better approach going forward.

“We haven’t attained any untoward outcomes,” European Union Trade Commissioner Cecilia Malmstrom told a news conference. “The sad reality is that we didn’t agree to stop subsidizing illegal fishing.”

She stated the meeting laid bare one of the WTO’s most significant deficiencies — that all agreements should have the unanimous approval of 164 member countries. She said the United States was partly to blame but other nations also blocked progress.

WTO Director-General Roberto Azevedo added that WTO members necessary to do some “real soul searching” about the way forward and recognize they can’t get whatever they want.

“Progress was likely to require a jump in members’ positions,” Azevedo said at the event’s closing ceremony. “We didn’t find that.”

He explained U.S. proceeds to block WTO appeals judges, which could disrupt the body’s dispute settlement system, weren’t discussed as a formal subject, but many ministers voiced concerns in announcements in the conference.

The failure to agree on new bargains means that talks about precisely the exact same trade topics will last. WTO delegates agreed to set a new target to get a attaining a comprehensive fisheries subsidy from the time of the upcoming ministerial summit in 2019.

Trade ministers instead highlighted the WTO’s post-conference work applications, like efforts to enhance market efficiency, curb excess industrial capacity and enhance subsidy transparency.

‘PLURILATERAL ARRANGEMENTS’

Malmstrom said “short term plurilateral arrangements within the WTO framework” were the best way ahead. Two such arrangements came together in the Buenos Aires conference.

On Wednesday, some 70 members, including the United States, European Union and Japan, vowed to forge ahead with negotiating rules on electronic commerce after a wider deal among the complete membership failed. Absent in the group were China, India, Vietnam and Indonesia.

The EU and Japan joined the United States on Tuesday in vowing to fight market-distorting policies, like those pervasive in China who have fueled excess industrial capacity, such as subsidies for state-owned enterprises and technology transfer requirements.

“The possible concentrate on plurilateral negotiations between like-minded nations is a natural and positive result, if it turns out to bear fruit,” said Chad Bown, a senior fellow and trade expert at the Peterson Institute for International Economics in Washington.

Bown said a fantastic template are the 1996 WTO Information Technology Agreement, which originally had only 29 countries lowering tariffs on IT products. That has since expanded to 82 countries covering 97 percent of trade in the industry.

The WTO conference’s chair, former Argentine Foreign Minister Susana Malcorra, defended the WTO’s requirement for unanimity among its large and unruly membership, stating it was the still the best forum to take care of trade disputes.

“Let us better work to strengthen WTO, since the alternative is that the jungle,” she said.

AT FIRST, ‘AMERICA FIRST’

The conference started with Lighthizer putting an acrimonious tone with sharp criticism of the WTO, telling ministers on Monday that it had been not possible to negotiate new rules while many of the present rules weren’t being followed, and that the WTO was losing its focus and getting too litigation-focused.

Driven by President Donald Trump’s “America First” strategy and a taste for bilateral trades, the United States had driven against ministers drafting a perfunctory ministerial that included references to the centrality of the international trading system and to trade as a catalyst of growth. The announcement was ultimately blocked.

Courtesy: The Globe And Mail

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