Economics Times, June 10, 2020
Since the World War II, the world has witnessed unprecedented growth in trade volume and global value chains. From trade in goods and services, we have moved to trade in tasks. It is primarily because of the role played by the rules-based multilateral trading system under the aegis of the World Trade Organisation.
Pradeep Mehta, Secretary General, CUTS International, a global public policy think on trade, regulations and governance is of opinion, “we should also highlight the role of the WTO in under-writing global security, peace and prosperity.”
He was moderating a webinar titled:What would happen to a world without the WTO? More than 200 stakeholders representing various interests of the global trading system from all over the world took part in it.
Speaking on the occasion, Dr Supachai Panitchpakdi, former Director General of the WTO and former Secretary General of the United Nations Conference on Trade and Development, said: “A more pertinent question may be what would happen to a world as a whole, not just trade. We may witness a deep recession including food crisis. We have to keep working on ending this pandemic including a Marshall Plan kind of an approach to particularly help poor countries.”
“From our experience of past disruptions, the world will recover when the global trading system recovers. Recent drop in imports to China is much more alarming than the decline in exports that they are witnessing. WTO can bring order back to a chaotic world,” he underlined.
“Along with more and more isolationist stance, we may witness shorter supply chains. In near future, geographic proximity and digital transactions will emerge as major determinants of trade and value chains. Trade restrictions are to be looked at in this new context,” he added.
Speaking at the meet Dr Kishore Mahbubani, Distinguished Fellow at the Asia Research Institute of the National University of Singapore, “For preserving global peace, we have to encourage trade. The fundamental threat to the global trading system comes from the fact that the United States has lost their confidence in various spheres of life, particularly cultural confidence. By contrast, China is much more confident than ever before. As a result, more the China supports anything the United States is expected to say no”.
Regarding the WTO’s dispute settlement system, he said “it is not just about fixing but more about re-building the confidence in settling conflicts by keeping in mind that trade is good for the world. For this to happen we have to go back to the basics. The question is: can we re-build it? Unfortunately, no Asian countries are taking the lead that they should.”
As per Manickam Supperamaniam, former Ambassador of Malaysia to the WTO: “Participation of developing and least developed countries in various committees of the WTO is very minimum and that is primarily because of their lack of capacity. We need to re-examine what should be the functions of these committees and how we can restructure them to improve their working functions.”
“This short-coming is also reflected in the functioning of the WTO’s dispute settlement system. They cannot just be the work of trade officials. Other stakeholders representing various interests should also be invited to the functioning of these committees so that an inclusive system is developed. This is needed for moving us from bargaining to regulatory cooperation” he articulated.
“This is major reform for the functioning of the WTO as a whole. We cannot afford to operate as it was in the past. Shared partnership for a shared vision is the need of the day. As against allowing some countries to set the agenda, we need a bottom-up approach. We have to take a serious re-look of systemic issues plaguing the functioning of the WTO in a holistic manner including the imperative of empowering the WTO Secretariat,” he added.
According to Tanya Spisbah, Director of the Australia India Institute, “It is worth looking back to the ethos of the Bretton Woods negotiations.In essence, the discourse was that multilateral problems need to be resolved at the multilateral level. We are witnessing same kind of situations as the multilateralism as a whole is under stress. We need to understand this.”
“WTO reforms are required. The question is what kind of reforms. We have systemic as well as representational issues. Broadly, we have to understand the value systems of all member countries underlining the necessity of arriving at consensus. This also depends on changing power equations, which are happening all over the world.Trade is not just about some exchange of goods and services. This fundamental change in our thinking about trade can happen if we can address its linkages with other values and necessities of life without resorting to a sanctions-based approach. Perhaps, it is time to ponder over a global trade organisation,” she argued.
Bipul Chatterjee, Executive Director of CUTS International notes, “We need to take a closer look at the WTO Agreement on Trade Facilitation to understand the values that it is and can bring to people’s lives. We should not look at trade facilitation just as a collection of provisions facilitating the exchange of goods and services. As against just thinking about market access, the future of trade should place more emphasis on values that trade can bring to various dimensions of our life.”
A general consensus the webinar was that the world has to get back to collective generosity. All countries will have to play a cooperative game, which is largely absent. While new geo-political alliances are emerging either implicitly or explicitly, they are different from what they used to be in the recent past. Emerging middle powers will have to keep this in mind and maintain their strategic autonomies.
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