Media: The Weakening WTO Seeks Reform and Self-Rescue Amid Great Power Competition
The World Trade Organization (WTO) convened its 14th Ministerial Conference in Yaoundé, the capital of Cameroon, starting from the 26th. If the ongoing energy crisis triggered by the Iran conflict is further disrupting international trade order at this moment, this high-level WTO meeting is particularly urgent in the context of tariff measures under Donald Trump’s second presidential term, which are significantly impacting the global trade landscape. The need to reach some consensus among member states on reforming the WTO—whose role has been increasingly eroded—is pressing. On the first day of the conference, WTO Director-General Ngozi Okonjo-Iweala explicitly stated that the international trading system is facing its worst challenges in 80 years.
The creation of the WTO was a post-World War II international effort to establish a system that would guide international trade and avoid the "law of the jungle." It replaced the General Agreement on Tariffs and Trade (GATT), originally signed in 1947 by 23 countries, and began formal operations in 1995, with expanding membership. China’s accession in 2001 accelerated the globalization of trade, making the WTO’s role in setting rules and resolving disputes increasingly essential. However, this coordinating function has been progressively weakened amid escalating tensions in major power trade relations, especially between the United States and China. The U.S.’s long-standing dominant position in global trade has faced growing challenges, while China’s economic rise has made trade-related conflicts between the two nations increasingly apparent. For years, the U.S. has complained that the WTO exacerbates trade imbalances and believes current WTO rules do not serve American interests.
U.S. dissatisfaction has blocked the appointment of judges to the WTO’s dispute settlement body, effectively paralyzing its arbitration function. While the U.S.-China trade war during Trump’s first presidency initially dealt a severe blow to bilateral trade relations, his second term’s sweeping tariff campaign targeting nearly 60 countries has severely undermined the entire international trade system established after World War II. Faced with such actions by major powers undermining multilateral trade rules, the WTO—which operates based on consensus among members—has been largely ineffective, and trade negotiations have stalled.
This tension became evident on the opening day of the 14th Ministerial Conference on the 26th. The U.S. Trade Representative preemptively criticized the WTO for enabling longstanding and severe imbalances in international trade, asserting that the multilateral system and negotiations have failed to establish fair principles. In contrast, China—now the world’s second-largest economy—countered firmly, defending the WTO’s role and calling for unity against unilateralism and trade protectionism, advocating for a rules-based multilateral trading system. Ironically, over recent years, China has itself been frequently accused by the U.S., Europe, and many other nations of undermining the rule-based international order.
Nevertheless, it is widely acknowledged that the WTO, now over 30 years old, has reached a critical juncture requiring deep reforms to remain viable. WTO Director-General Okonjo-Iweala stated clearly that maintaining the status quo is not an option. The European Union also views the WTO as at a life-or-death crossroads. Yet the question remains: how should reform proceed, and can a reform proposal acceptable to the majority of members be found?
The United States presented its own version of WTO reform at this ministerial meeting, particularly proposing changes to the principle of Most-Favored-Nation (MFN) treatment—the cornerstone of the WTO. MFN means that any bilateral agreement reached within this multilateral trade framework applies equally to all third parties. Developing countries, including China, insist that MFN should remain the foundation of the multilateral trade coordination mechanism.
The U.S. proposal also calls for redefining what constitutes a “developing country.” Although unnamed, the U.S. and China have repeatedly clashed in recent years over whether China—now the world’s second-largest economy—should still be classified as a developing country and continue to enjoy special privileges under this designation.
Additionally, the U.S. proposal demands new rules promoting greater transparency among members regarding state subsidies—a long-standing criticism raised by Western countries like the U.S. and EU against Chinese trade practices.
Another component of the U.S. plan is preventing WTO rules from undermining national security policies. The recent deterioration in U.S.-China relations reflects, to a large extent, the tension between free and open trade and national security concerns.
It is broadly agreed among most members that the 30-plus-year-old WTO needs profound reform to survive. However, opinions diverge sharply on how to carry out reform. Achieving a meaningful consensus among more than 160 member states during this pivotal Yaoundé Ministerial Conference—described by the WTO Director-General as a crucial stage—is no easy task.
Source: rfi
Original article: toutiao.com/article/1860833904702600/
Disclaimer: This article represents the personal views of the author