WTO’s DG: US makes weird proposal for restart of process

The United States has suggested that the process of finding a new director-general of the World Trade Organisation (WTO), which is almost completed, needs to be reopened.

US President, Donald Trump’s trade chief, Robert Lighthizer, told the BBC News on Thursday that the WTO needs “someone with real experience in trade, not someone from the World Bank or a development person.”

This is coming on the heels of WTO’s lamentation that the absence of a substantive director general is hurting its operations.

Ngozi Okonjo-Iweala, former Nigerian minister of finance and former managing director (MD) of the World Bank, had gotten the support of 110 out of 164 member countries but the US opposed her candidacy.

The trade organisation operates based on consensus, that is, if one country opposes, a final decision cannot be made.

Iweala and Yoo Myung Hee, South Korea’s trade minister, are the final candidates for the top job at the WTO following the resignation of Roberto Azevêdo in May.

Following the lack of a consensus, the WTO had postponed the general council meeting to consider the appointment of a new DG till further notice.

Lightizer confirmed that there is no way the Trump administration would be persuaded to back Iweala in its remaining weeks in office.

He said the WTO is “massively in need of reform”, especially its dispute-resolving appellate body, which according to him, has evolved into a body creating a common law of trade, “taking away benefits” that members had negotiated for and putting restraint on things that had been conceded.”

The appellate body of the WTO has been rendered inactive by Donald Trump’s administration vetoing the appointment of new judges.

“I think there’s a consensus developing at the WTO that we need the appellate body reform. We need to start negotiating again, we need to start making headway. So I’m glad you brought up the WTO, it’s been clearly a focus for us and to us it’s an organisation that started off as a good idea and basically isn’t functioning very well, but I think that can be sorted out also,” Lightizer said.

James Bacchus, a former chairman of the WTO appellate body, as well as a former US trade negotiator, said: “Effective multilateral cooperation to lower barriers to trade is urgently needed to help jumpstart the global economy and recover from the pandemic. That requires creative leadership from an honest broker in the role of director-general.”

Despite speculations that the Joe Biden administration might have a different stance on Iweala’s appointment, the US president- elect has not confirmed his preference.

“We need to be aligned with the other democracies.. so that we can set the rules of the road instead of having China and others dictate outcomes,” Biden had said on trade recently.

Simon Lester, a WTO expert at the Cato Institute in Washington, said that it would be a good idea if the Biden administration could trade off support for Iweala for political capital on other reforms.

According to Lester, this would be the fastest way to appoint a new WTO DG, because “opening up the selection process could be messy and complicated, and would lead to delays”.

Meanwhile, the WTO on Friday stated that the absence of a substantive director general is hurting its operations and would not describe 2020 as a very successful year.

The WTO made this statement during a press briefing, adding that a special general council early in the New Year is needed to make a decision on the matter.

It re-echoed during the press briefing the words of the Permanent Representative to the WTO Ambassador David Walker, who told the council that there was no change in the situation about selecting a substantive DG and that “it remains elusive.”

The trade organisation stated that the absence of a substantive director general is hampering discussions on important issues like the fisheries subsidy.  (ThisDay)