TWN Info Service on WTO and Trade Issues (Jul19/29)
25 July 2019
Third World Network

Reform process a serious test for the WTO, says DG

Published in SUNS #8952 dated 23 July 2019

Geneva, 22 Jul (Kanaga Raja) – The “reform” of the World Trade Organisation (WTO) “is already happening” and what is clear is that this reform process is a “serious test” for this organisation, according to Roberto Azevedo, the WTO Director-General.

Speaking at an informal meeting of the Trade Negotiations Committee (TNC)/Heads of Delegation (HOD) on 19 July, Azevedo said: “Either we evolve and adapt in order to deliver on the expectations of our users – or, ultimately, we give way to a fragmentation of the global trading system.”

Referring to the current debate among Members on the issue of WTO reform, Azevedo said the discussions have focused on three areas: addressing issues in the Dispute Settlement System including the impasse in appointments to the Appellate Body, strengthening the work of the regular bodies in the WTO, and improving the WTO’s negotiating work.

The DG’s statement was preceded by reports from the chair of the Negotiating Group on Rules on the latest developments in the fisheries subsidies negotiations; the chair of the agriculture negotiations; the chair of the Committee on Trade and Development in Special Session; and the chair of the Dispute Settlement Body in Special Session.

Referring to the departure of the chair of the Negotiating Group on Rules where the negotiations on fisheries subsidies disciplines are taking place, Azevedo said that finding a chair to replace Ambassador Roberto Zapata of Mexico is urgent given the tight timeline for the fisheries subsidies negotiations.

According to trade officials, the DG expressed hope that members will be constructive and flexible in undertaking the selection process very quickly.

He also said the working papers (on fisheries subsidies) put forward by the facilitators represent an important step forward but they also underline the scale of the challenge before members. It is up to all delegations to have their positions evolve.

The working papers are a good platform, and one piece of good news is that there was a surge of submissions of notifications of fisheries subsidies before the 30 June deadline.

On the issue of agriculture, Azevedo said that members need to consider what is doable in the short-term, and for those issues that cannot be delivered on right away, there needs to be some kind of framework for addressing them later on.

On the crisis in the Appellate Body, Azevedo pointed out that there are only three working months remaining (before the terms of two AB members end on 10 December 2019 leaving the AB with only one member), and the systemic implications of this are well known to all.

He said that he had called on the G20 leaders (at their recent summit in Osaka, Japan) to urge their negotiators to suggest new creative approaches to going forward.

Beyond that, he added, other areas of reform that are being looked at pertain to regular bodies and this deals with notification and transparency, while another area is the negotiating work of the WTO.

Azevedo said that there is need to improve the way members negotiate so that they can keep delivering more agreements that have real economic impact.

On the plurilateral Joint Statement Initiatives, the DG claimed that progress is being seen, but that this is an area which is very much in the hands of the proponents and it is up to them to determine how these talks will evolve and what can be achieved.

On the issue of WTO reform, he said there was a lot of focus on this issue at the G20 leaders’ summit in Osaka.

Azevedo said that the WTO is more a focus of the G20 leaders than it has ever been and it is especially through the lens of reform.

He said that this was consistent with the path that was followed for a number of years, adding that the Trade Facilitation Agreement of 2013 was a reform.

There have been other breakthroughs but the fact of the matter is that progress is stalled in many other areas and the systemic problems and shortcomings have been evident for many years.

Azevedo said: “I’ve been getting questions inside and outside these walls about what WTO reform will entail.”

“I think there are two basic misconceptions here. The first is talking about reform as if it’s in the future. Reform is already happening. The second misconception is assuming that we can define it all now. I think members must define as they go.”

“This process is for members to shape. What a reformed WTO may look like will depend on what you set out to achieve, and what you actually manage to deliver. No area of our work is perfect. All of it can be improved.”

“And we will always need to be alert to how the system can better respond to members’ concerns and adapt to economic conditions,” said the DG.

“What is clear is that this reform process is a serious test for this organisation. Either we evolve and adapt in order to deliver on the expectations of our users – or, ultimately, we give way to a fragmentation of the global trading system.”

“I think it is incumbent on all of us who believe in multilateralism to respond to the challenges of today, not to rely on recipes designed for other times,” he said.

“It may well be that some of the paths forward will not be followed by all, but they must be available to all and no one should be forced to take them.”

“Where those paths will lead, we will see when we get there. But don’t pack for a short trip. The challenges we have before us will not be tackled overnight – or over a few months. We are in for a rather long journey,” the DG cautioned.

“But I believe it is one that is unavoidable. Staying where we are is not an option. In fact, the journey has already begun, whether one realises this or not. So let’s seize this opportunity to update and strengthen the system,” he said.

A number of delegations took the floor following the reports by the chairs of the various Doha negotiating groups and that of the Director-General (see separate story).