The president of the World Trade Organization (WTO) emphasised the necessity of modernising the global trade body to avoid more trade wars, but cautioned that it would be “extremely difficult” given the current geopolitical climate. Under pressure to show its relevance, the 27-year-old global trade agency was set to hold a major ministerial meeting this week, with a plan to revise the global trade rule book among the main subjects. However, owing to travel restrictions associated to the COVID version Omicron, it was postponed, further lowering already weak prospects for advancement.
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In response to a question about the WTO’s reformability, Ngozi Okonjo-Iweala remarked in an interview at the Reuters Next conference: “Without a doubt. Another question is whether it will be simple to implement. Because of the absence of trust among members, I believe it will be extremely difficult.” The Appellate Body, the WTO’s top appeals tribunal, has remained inactive since 2019, when former US President Donald Trump’s government stopped judge nominations.
To avoid future trade battles, Okonjo-Iweala said the WTO’s dispute settlement mechanism must be protected, and Washington’s “legitimate worries” about overreach must be addressed. She cautioned that the present climate is “rife with geopolitical tensions,” and that the rules-based trade system might be replaced by a power-based system, with smaller nations suffering the most.
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“Supporting global trade is critical, and we must not take it for granted,” she added. Okonjo-Iweala, who has been the director-general of the Geneva-based trade organisation since March, said she sees numerous prospects for the Geneva-based organisation, especially in the field of climate change, such as the implementation of a global carbon pricing. The WTO may be at the vanguard of the global battle against climate change in a variety of ways, from establishing laws on fossil fuel subsidies to fostering low-carbon supply chains.
