WTO, IMF, World Bank seek ‘urgent’ international trade reforms
The slow pace of reforms since the early 2000s, fundamental changes in a more interconnected economy, and the risk of trade policy reversals call for urgency to reinvigorate trade policy reforms, the bodies said
Geneva: The World Trade Organization, International Monetary Fund and World Bank on Sunday issued an emergency call to reform the multilateral trading system as the US retreats from prior agreements.
‘The urgent challenge today is to harness the unique strength of the WTO,’ the bodies said in a joint report. ‘The slow pace of reforms since the early 2000s, fundamental changes in a more interconnected modern economy, and the risk of trade policy reversals call for urgency to reinvigorate trade policy reforms.’
President Donald Trump this week harshly criticized globalism in general and questioned America’s participation in multilateral institutions like the WTO during the United Nations General Assembly meeting in New York.
Meanwhile, fallout from the escalating US-China trade conflict led the WTO to cut its trade growth forecast this week, and WTO Director-General Roberto Azevedo warned that a full-blown trade war ‘would knock around 17% off global trade growth, and 1.9% off GDP growth.’
The joint paper by the Washington-based groups outlined specific initiatives aimed at modernizing WTO rules, including a focus on increased market access for e-commerce, more flexible negotiating structures and better transparency of government trade policies.
The recommendations echo many goals outlined in various WTO reform proposals offered this month by the European Union and Canada.
Recognizing the dire state of the WTO, countries like Canada and the EU are preparing the groundwork to update the organization’s 23-year-old rule book.
Though both China and the US endorse the need for WTO change, they have polarized views on how to do so.
The WTO, IMF and World Bank jointly called for new rules to address the expanding role of electronic commerce along with investment and services trade in the 21st century.
‘The opportunities provided by information technology and other fundamental changes in the global economy are yet to be reflected in modern areas of trade policy,’ the report said.
The three institutions also advocated the more so-called use of plurilateral talks to help unblock trade negotiations that have failed to advance at the multilateral level.
Plurilateral accords are deals negotiated among a group of like-minded members that are limited to certain sectors of goods or services. Such agreements are typically easier and faster to negotiate than multilateral accords, which require a consensus among the WTO’s 164 members.
The joint report urged WTO members to work together to fix the impasse in the WTO dispute settlement system, which risks paralysis due to the Trump administration’s refusal to appoint appellate body members.
Over the past year the US has cited a pattern of judicial overreach at the WTO and has blocked the appointment of experts to the appellate body, which has the final say in WTO dispute rulings.
After Sunday, the seven-person panel will have three members — the minimum required to sign off on appellate body rulings.
If the US continues to oppose new appointments to the panel beyond December 2019, the body will not have enough panelists to sign off on rulings and the WTO will lack the ability to fully adjudicate trade disputes involving the world’s largest companies.
- Prepare a list of press invites under NDA: PMO to ministries
- Scientists clone hybrid rice seeds in breakthrough that could cut costs for farmers
- Railways to amend suburban policy after backlash from states
- Kamal Nath named new chief minister of Madhya Pradesh
- EU, India and China ‘new trilateral’ at WTO, says US
Editor's Picks »
- Continuing volume momentum puts Indian ports in a good position
- Why did BJP lose Assembly Elections 2018? Retail inflation has answers
- Rural focus drives Hero MotoCorp, but inherent risks linger
- ‘Talk to me’, says RBI governor Shaktikanta Das in relief to markets
- Escorts: Japanese joint venture to hone growth in tractors