The Economic Times, August 01, 2025
A broad coalition of the willing, comprising economies large and small, developed and developing, need to work together to prevent the World Trade Organisation (WTO) from sinking. This was the consensus of a group of experts speaking at a webinar on WTO reform organised by public policy research and advocacy group CUTS International.
Montek Singh Ahluwalia, former Deputy Chairman of the Planning Commission of India, pointed out that if countries and blocs which command a large proportion of world trade are entering into WTO- violative preferential deals with the United States of America (US), it does not bode well for the Multilateral Trading System (MTS). Ahluwalia said that the only costs to the present US approach of aggressive trade unilateralism can come from its rejection by others, which does not seem to be happening.
While Ahluwalia said that the disintegration of the rules-based MTS was deeply disturbing, he also noted that not too many tears are being shed on the departure from the foundational non-discrimination principle of Most- Favoured Nation (MFN). “Major developing countries need to tie-up with their major markets in a rule-based environment. What this would look like remains the open question”, he said.
Pradeep S. Mehta, Secretary General, CUTS International and NGO Adviser to the DG, WTO, highlighted that despite its many problems, the WTO system has been a historical success. He added that, “WTO remains relevant for global trade, and especially for developing countries. The WTO is worth fighting for”.
He suggested that the need of the hour is to cultivate a positive narrative around the centrality of the WTO in the global trade architecture, and spur a coalition of both developed and developing countries to lead reform efforts.
Mehta reiterated that the WTO is a global public good, and as such, no one country has greater stake in an effective multilateral trading system than any other. A well-functioning WTO is in the interest of all trading nations, and especially in the interest of developing countries. Rajesh Aggarwal, Visiting Professor, ICRIER and former Chief of Trade Policy, ITC, Geneva, presented a paper on WTO reform. He emphasised that it was time for developing countries at the WTO to stop merely defending their turf and instead take the lead in shaping the WTO’s future.
Aggarwal added that bold engagement, proactive leadership, and are imagining of developing countries’ role in global trade governance is the need of the hour.
He cited the August 2003 pre-Cancun WTO Ministerial “G20 coalition on agriculture”, steered by Argentina, Brazil, India, China, Indonesia and South Africa as an example of the influence a developing country coalition can have in reshaping the WTO discussions and narrative.
Aggarwal called for a similar spirit of alignment among major developing countries today, which goes beyond merely protecting self-interest and instead advances rule-shaping at the WTO.
He presented several points on which meaningful dialogue needs to be initiated among developing countries which could lead to a common position on WTO reform, including special and differential treatment and plurilateral agreements.
Victor do Prado, former Director of the Council and Trade Negotiations Committee at the WTO, now Sr Fellow CEBRI, Brazil said that any discussion on WTO reform needs to be based on a clear understanding of the prevailing global trade context. He stressed that before discussing any reform proposals, a fundamental question which needs to be asked is – who will lead the reform of the WTO? This requires a country that inspires the trust of the others, and a recognition that it serves the interests of the system.
Do Prado opined that no individual country may be able to take up this mantle at the moment, and a group of countries may be better placed to do so. He underlined that such an effort would require a group of countries irrespective of development status to join forces on the major systemic issues at the WTO, but said that such concerted action driven by a common purpose remains a long shot.
Trudi Hartzenberg, Executive Director, Trade Law Centre, Cape Town, South Africa, called for a rethinking and recasting of the MTS which is fit for new realities today. She provided several insights on South Africa’s engagement with the WTO over the years – from an ambitious trade liberalization programme when it joined the WTO, as part of its larger reintegration in the global economy after a long period of isolation, to co-leading today, along with India, the contestation of plurilateral-type arrangements at the WTO.
Hartzenberg underlined that although South Africa remains a very active participant at the WTO, it has not been a supporter of embracing new realities and emerging requirements for pragmatic trade governance. South Africa remains a key proponent of trade multilateralism, but one which goes back to a previous context and a previous era – one which may not have kept pace with the demands of modern trade governance.
Xiankun Lu, former senior trade diplomat of China and CEO of Friends of Multilateralism Group (FMG), Geneva, stressed that compromises based on dialogue and discussion will be key to developing countries working together at the WTO.
He cautioned that if developing countries do not play an active role in shaping WTO reform, their role in crafting the future of the WTO will be marginalized and they will actually be contributing to further pulling down the WTO’ s edifice. Lu suggested that middle-grounders, including both developed and developing countries, will need to step up and take leadership in pursuing WTO reform, and the larger players need to then engage with the emerging configurations. Within these, developing countries can try and develop common positions and proposals on specific reform aspects. Notably, many voiced reservations about the prospects of repeating a 2003agricultural G20 coalition moment, pointing out that the driving interests are very different today. There are major differences among these developing countries on systemic issues like plurilaterals and the Multi-Party Interim Appeal Arbitration Arrangement (MPIA).It was repeatedly emphasised that the agricultural G20 coalition remains an exception. Developing countries are no longer working together, in fact they are quite often working against each other.
Shaanti Shamdasani, President, S. ASEAN International Advocacy &Consultancy, Jakarta called for a massive overhaul of WTO mechanisms in all areas, and carefully assessing what suits the future of the WTO and what doesn’t. Shamdasani declared that the old ecosystem within which the WTO was flourishing has now receded, and technology-driven developments have moved so far ahead that the WTO has been left behind. She pointed to the need to focus on the elements that will bring WTO relevance in both current and future needs.
Ujal Bhatia, former Chairman of the WTO Appellate Body and India’s Ambassador to the WTO, said that it is important to first diagnose why the WTO is in crisis, before we start fixing it. He lamented that even on major disruptions like the US unilateral tariffs, the WTO has not been able to hold meaningful discussions.
Bhatia reiterated that the existential systemic challenges at the WTO are affecting all members interested in preserving the rules-based order, and it should not be seen as a developing versus developed country issue. He called for the canvas of discussion to be widened to all countries which are interested in preserving the rules-based trading order.
Bhatia further opined that if a group of WTO members can come together to draft a Work Programme which addresses the concerns of the entire membership, there will be increasing buy-in. The credibility of such a coalition would depend upon its degree of inclusivity, he said.
Over 60 participants from around the world attended the webinar.
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