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TWN Info
Service on WTO and Trade Issues (Nov20/08) Geneva, 9 Nov (D. Ravi Kanth) – The chair of the WTO General Council (GC), Ambassador David Walker from New Zealand, has postponed the “special” GC meeting scheduled to take place on 9 November for appointing the new WTO director-general Ms Ngozi Okonjo-Iweala from Nigeria, in view of “current events” as well as the heightened COVID-19 restrictions. In his communication on 6 November, contained in document Job/GC/248, the GC chair informed members about the decision reached by the selection panel on 28 October to appoint “Dr. Ngozi Okonjo-Iweala as the candidate most likely to attract consensus and recommending her appointment by the General Council as the next Director-General of the WTO”. At an informal heads of delegation (HoD) meeting on 28 October, the selection panel, chaired by Ambassador Walker along with the chair of the Dispute Settlement Body (DSB) Ambassador Dacio Castillo (Honduras) and the chair of the Trade Policy Review Body (TPRB) Ambassador Harald Aspelund (Iceland), had recommended the appointment of Dr Ngozi Okonjo-Iweala “in accordance with the Procedures for the Appointment of Directors-General adopted by the General Council and contained in WT/L/509 and the agreed modalities for Phase 3 of the process in JOB/GC/243.” At that informal HoD meeting, the GC chair had announced that he would schedule a special GC meeting on 9 November to take a formal decision on the appointment of Dr Ngozi as the new director-general. It had previously been reported on 30 October that the GC meeting is unlikely to take place due to the new COVID-19 restrictions imposed by the Swiss authorities that has made it difficult for any gatherings of more than 50 members to take place. (See SUNS #9223 dated 2 November 2020.) Under the GC rules of procedure, particularly Rule 16, decisions can only be made if half of the membership of 164 – i.e. 82 members – are physically present at the meeting. “It has come to my attention that for reasons including the health situation and current events, delegations will not be in a position to take a formal decision on 9 November,” the GC chair said in his communication on 6 November. “I am therefore postponing this meeting until further notice during which period I will continue to undertake consultations with delegations,” he added. THE BIDEN ADMINISTRATION It is not, however, clear whether the GC chair’s decision may have been influenced by “current events” in Washington DC, where the Democratic Party, led by Joseph Robinette Biden, is likely to take over office in about 75 days if all the legal wrangles are resolved. More importantly, Joe Biden’s administration could take a favourable decision to support Dr Ngozi, who is seen as being close to the Democratic Party, said a person who asked not to be quoted. Dr Ngozi’s appointment was blocked last month by the US Trade Representative (USTR) Ambassador Robert Lighthizer. Ambassador Lighthizer made it clear that Washington will only support Ms Yoo Myung-hee, South Korea’s current trade minister. The USTR had said unambiguously that he “supports the selection of Korean Trade Minister Yoo Myung-hee as the next WTO Director-General.” However, Ms Yoo from Korea failed to receive enough support from members of all levels of development – i.e., the developed, developing, and least-developed countries, as well as geographically, in comparison to the “largest support” received by Dr Ngozi. “Part of the reason for the obstinate position adopted by the USTR against Ms Ngozi is that she is seen as close to the Democratic Party,” said another person familiar with the selection process. With the expected change of the administration in Washington, which would bring a Democratic administration into office at the end of January, there could be a rethink in changing the position adopted by the current US administration at the General Council meeting last month, the person said. Trade policy experts also commented on the pros and cons of the Biden administration in the arena of trade and whether it would maintain continuity or break off with the unilateral trade measures imposed by President Trump. Historically, US trade policy has maintained a high degree of continuity regardless of the change of administration, except for the form or the style of the specific trade measures imposed on other countries. The concerted process of chipping away at the functioning of the Appellate Body (AB) started under the Obama administration in 2016 when it blocked the extension of a second term of the Korean AB member Seung Wha Chang. In an apparent attempt to undermine the Doha Development Agenda (DDA) round of multilateral trade negotiations, the Obama administration, after securing the Trade Facilitation Agreement at the WTO’s ninth ministerial conference in Bali, Indonesia, in December 2013, refused to pursue further the DDA negotiations at the tenth WTO ministerial conference in Nairobi, Kenya, in December 2015. Significantly, the Obama administration concluded the Trans-Pacific Partnership (TPP) agreement negotiations in 2015, which was rejected by the Trump administration in 2016. It is an open secret that the TPP negotiations were primarily aimed at containing China in the global trading system by bringing in new disciplines on electronic commerce, state-trading enterprises, and intellectual property rights among others. Meanwhile, writing in the International Economic Law and Policy blog, Simon Lester, a former WTO official and now at the Herbert A. Stiefel Center for Trade Policy Studies, Cato Institute, in Washington DC, said that “it is easy to imagine that the new Democratic trade leadership might draw on what the House Democrats pushed the Trump administration to do, for example, on issues such as investment, intellectual property, labor, and the environment.” Lester suggests what the Democratic administration should “do on a few of the key trade issues the Trump administration has left us with.” They include: * Repealing Section 232 tariffs as quickly as possible to help the US economy and repair relations with allies. The Biden administration will have to offer something to interest groups for repealing Section 232 tariffs imposed on steel and aluminum in many countries. * Engaging with WTO members by proposing specific reforms for appellate review and “by agreeing to the appointment of new Appellate Body members, as the US needs effective dispute settlement to ensure the rule of law in International Trade.” * Developing a concrete plan along with the European Union, Japan, Australia, the United Kingdom and other developed countries to negotiate jointly with China “to force it (Beijing) to upgrade its liberalization commitments and jointly bring WTO complaints against China.” * Pursuing bilateral and regional trade agreements, including the revised TPP commitments in which the Democratic administration could minimize the IPR and investment commitments. However, Lester appears to be silent on whether the Democratic administration should pursue the reforms proposed by the Trump administration at the WTO such as differentiation/graduation of developing countries from availing special and differential treatment based on self-designation, punitive transparency and notification requirements, and new market-oriented reforms. [The full post by Prof Lester can be accessed at: https://ielp.worldtradelaw.net/2020/11/us-trade-policy-after-trump-preliminary-thoughts.html] Since Biden has repeatedly maintained that fighting the COVID-19 pandemic is his top priority, it remains to be seen whether his administration would support the waiver proposed by South Africa, India, Eswatini (formerly Swaziland) and Kenya from implementing several TRIPS provisions in fighting COVID-19 as long as it persists. BIDEN’S STANCE ON CHINA According to an editorial comment by China’s Global Times on 8 November, the Biden administration will “maintain a tough attitude to China” in line with the aggressive benchmarks set by the Trump administration. The “bubbles” created by the Trump administration against China during this year could be brought to an end in areas such as curbing the COVID-19 pandemic, and strengthening the Paris Agreement on climate change among others. In the area of trade, according to the Global Times, the Biden administration “is highly likely to continue Trump’s “maximum pressure” campaign, but probably not with reckless gambling-style moves.”
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