The world can no longer afford to keep the WTO in a ventilator: Pradeep Mehta, CUTS International

September 23, 2020, New Delhi

Peace, security, stability and prosperity that the post-war world has witnessed over the last 75 years are largely due to the rules-based multilateral trading system, which has underlined them. They are now under attack from various quarters.

“The world can no longer afford to keep the World Trade Organisation, which governs the rules-based multilateral trading system, in a ventilator,” said Pradeep Mehta, Secretary General of CUTS International, a global public policy think- and action-tank on trade, regulations and governance.

“As the WTO has effectively been rendered dysfunctional so as to stop it from being misused, there should be a new global compact for its reforms including dispute settlement mechanism so that no countries can take undue advantages,” Mehta argued.

“As an aftermath of the Covid-19 pandemic, a new world is going to unfold and we don’t know as yet how it would look like. Multilateralism per se and trade multilateralism in particular is under a very serious threat. The question is how to deal with this threat when it is needed most. The WTO is in a ventilator and it has to come out of it.”

He was speaking at a webinar held today on “What would happen to a world without the WTO?” organised by CUTS International and the Geneva office of the Friedrich Ebert Stiftung.

It was organised as part of the World Trade Forum, a joint initiative of the Robert Schuman Centre for Advanced Studies of the European University Institute, Florence and the World Trade Institute, Berne.

Speaking on the occasion, Bernd Lange, a Member of the European Parliament from Germany and Chairman of the European Parliament’s Committee on International Trade, said: “I am convinced that in this Corona pandemic the tendency of undertaking protectionist measures is causing much disruption to trading relations as well as employment worldwide. The world without the WTO may look like more mercantilist.”

“We really need to re-organise the WTO. We have to find a way forward to modernise its rulebook. We have to also look at how digitisation can improve trading relations including its employment generation prospects.”

According to Emily Jones, Associate Professor of Public Policy, Blavatnik School of Government, University of Oxford, “Without the WTO, we will continue to see a transactionalist approach, the outcomes of which depend on differential powers of countries.”

“The starting point for reforming the WTO should not be an exclusive focus on how we get China to play by the rules. Right across the world we are seeing recalibration between domestic economic concerns with the requirements of a liberal international economic order. We need to move towards a system that enables countries to pursue different approaches to managing their economies, while also limiting harmful spill-overs, rather than pursuing a deep harmonisation agenda. We also need to understand the needs of the poor countries who think that they have not benefited much from the existing trading system.”

“We need a system to enable countries to take different approaches to trade liberalisation and to do it peacefully. We have to create space for new ways to collaborate and not just to focus on negotiating new issues,” she added.

Echoing the thoughts of other speakers, Kimberley Botwright, Community Lead on Global Trade and Investment of the World Economic Forum stressed on the founding objectives of the WTO.

“We need to go back to the Preamble of the Marrakesh Agreement of 1994, which established the WTO and revisit its objectives so as to underline the need for enhancing living standards and for ensuring sustainable development through optimal use of resources,” she added.

“The question is has the WTO been an effective organisation to meet these objectives. There is no doubt that on an average living standards have gone up. In regard to sustainable development, the situation is not that good.”

“While the scorecard is mixed, can we revisit those objectives under the present system of governance of the multilateral trading system? We need to make systemic changes in the functioning of the WTO so as to address new challenges which are and will arise as an aftermath of the Covid-19 pandemic.”

“A more advanced organisation than what was established in 1995 is required so that we can conduct necessary interfaces between trade and other important subjects such as finance, tax reforms, climate change,” she argued.

Taking part in the deliberations on the need for systemic reforms of the WTO, Pradeep Mehta argued that we often tend to equate sustainable development with environmental concerns only.

“That is not correct. Economy, equity and environment are three equally important components of sustainable development and we need to see how trade can address them in a balanced manner.”

He also argued for enforceable special and differential treatment provisions in multilateral trade agreements so that poor countries can draw more benefits out of them.

In his concluding remarks, Bipul Chatterjee, Executive Director of CUTS International, underlined the importance of ‘trust-building’ among various countries and interest groups including labour and consumer communities for effectively reforming the functioning of the multilateral trading system. “It can’t be made hostage to a country, which has made a mockery of it over the last two decades.”

Recalling a thesis on reasons behind the coming together of Southeast Asian countries propounded by Kishore Mahbubani of the National University of Singapore, Chatterjee said that it is the ‘dis-trust’ over an authoritarian, managed trade regime on the part of China will ‘force’ other trading powers including middle powers like India to arrive at a new global compact for a better-governed multilateral trading system in the 21st Century.

“That process has started with the shifting of supply chains away from China,” he argued.

This was the sixth in a series of webinars organised by CUTS International as part of its “Campaign on a World without the WTO”. Based on inputs from these webinars, CUTS will publish a discussion paper, which will be widely circulated among the global community at large.

In April this year, in order to counter protectionist measures as an aftermath of the Covid-19 pandemic, CUTS issued a Statement to make a pledge for treating international trade as a global public good. It has been endorsed by more than 50 thought-leaders and experts from all over the world.


For more information please contact:

Bipul Chatterjee, +919829285921,

Vijay Singh, +919910264084,

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