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TWN
Info Service on WTO and Trade Issues (Jul25/31) Geneva, 28 Jul (D. Ravi Kanth) — The World Trade Organization’s Director-General, Ms Ngozi Okonjo-Iweala, on 25 July appointed Ms Jennifer DJ Nordquist, a senior economic official with the Trump administration, as a Deputy Director-General (DDG), replacing former DDG Angela Ellard, also from the United States, who was the nominee of the previous Biden administration, said people familiar with the development. In her letter sent to members on 25 July, the DG praised Ms DJ Nordquist, who is currently a Counselor at the Council of Economic Advisers at the White House, “as a seasoned economic and policy analyst and strategist, having worked across the White House multilateral institutions, think tanks, corporate and non-profit boards, and federal agencies.” The appointment of Ms DJ Nordquist as a DDG has seemingly brought the DG close to the Trump administration, notwithstanding the irreversible damage that the unilateral tariffs imposed by the US has done to the multilateral trading system, and the WTO in particular, said several trade envoys, who asked not to be quoted. Moreover, the appointment has seemingly removed the likely tensions between the DG and the Trump administration, as the previous US Trade Representative during US President Donald Trump’s first term, Ambassador Robert Lighthizer, had reportedly blocked Ms Okonjo-Iweala’s appointment as the DG on grounds that she does not have any experience in trade issues, the trade envoys said. Given the fact that the re-appointment process of the DG to a second term was advanced last September based on the prospect of an incoming Trump administration, the DG seems to be steering the “sinking WTO ship” towards the reforms being sought by the Trump administration, said trade envoys, who asked not to be quoted. In her intervention at the Doha Trade Negotiations Committee (TNC) meeting on 15 July, the DG told members that they “must listen to the US and its criticisms [on reforms] because a lot of those are right.” The WTO is seemingly grinding to a halt due to the Trump administration’s allegedly illegal unilateral tariffs, forcing countries to adopt “non-MFN [most-favoured-nation] tariffs” and creating further uncertainty and turmoil in global trade, a former long-standing WTO DDG told the SUNS. Preferring not to be quoted, the former DDG said that “one ray of hope I have is that, taking a cue from the USA, many middle powers would seek to adopt non-MFN tariffs.” “As more and more countries adopt non-MFN tariffs, they will be seeking improvement in their tariff treatment through ceaseless negotiations and there will be no stability in trade relations and this will hamper trade, and trading could even come to a stop,” the former DDG said. Further, the former DDG said that “multiple and ever-changing tariffs will leave trading entities in a welter of confusion,” as President Trump is thinking of trading with all other countries. “But third countries may also try to trade among themselves on the basis of non-MFN tariffs,” the former DDG said. AB APPOINTMENTS BLOCKED Meanwhile, in a separate development, the US on 25 July blocked a request by Colombia, on behalf of 130 countries, to start the selection process for filling the seven vacancies at the Appellate Body (AB) on grounds that its longstanding concerns about the functioning of the AB remain unresolved, said people familiar with the development. At a meeting of the Dispute Settlement Body (DSB) on 25 July, for the 89th time, the US blocked the Colombian proposal on behalf of 130 countries even though the proposal represented an enduring and consistent stand from such a large majority of countries with “a common interest in the functioning of the Appellate Body and, more generally, in the functioning of the WTO’s dispute settlement system.” In its oft-repeated intervention, the US appears to have said that it has long-standing concerns with WTO dispute settlement that has persisted across US administrations. The US stuck to its earlier position that it will reflect on the extent to which it is possible to achieve a reformed WTO dispute settlement system. It had already ruled out that the Appellate Body will be restored, said people familiar with the development. Many members, including the African Group, underscored the urgent need to restore a fully functioning dispute settlement system. DS REFORM Also at the meeting, the chair of the DSB, Ambassador Clare Kelly of New Zealand, informed members that the WTO’s General Council chair, Ambassador Saqer Abdullah Almoqbel from Saudi Arabia, had asked her to hold informal consultations with members to hear their views on how to restart the dispute settlement (DS) reform conversation, and how they view the DS reform conversation in the wider WTO reform process, said people familiar with the development. Several countries said that they cannot take the WTO reform discussions seriously unless they know what it is that they are going to secure, especially as regards the restoration of the two-tier dispute settlement system with a binding Appellate Body, said people familiar with the development. It is highly unlikely that there will be any credible outcome on dispute settlement reform by the WTO’s 14th ministerial conference (MC14), to be held in Yaounde, Cameroon in the last week of March next year, said people familiar with the development. The DSB chair appears to have said that she has been conducting consultations over the past few weeks, adding that the consultations are ongoing and that her door remains open. Vietnam signalled that it was actively undertaking its domestic procedures to join the Multi-Party Interim Appeal Arbitration Arrangement (MPIA), a contingent measure aimed at safeguarding the right to appeal in the absence of a functioning Appellate Body. Recently, the United Kingdom announced that it is joining the MPIA, which includes Australia; Benin; Brazil; Canada; Chile; China; Colombia; Costa Rica; Ecuador; the European Union; Guatemala; Hong Kong, China; Iceland; Japan; Macao, China; Malaysia; Mexico; Montenegro; New Zealand; Nicaragua; Norway; Pakistan; Paraguay; Peru; the Philippines; Singapore; Switzerland; Ukraine; and Uruguay. +
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