|
||
|
TWN
Info Service on WTO and Trade Issues (Mar25/07) Geneva, 11 Mar (D. Ravi Kanth) — Preparations for the World Trade Organization’s 14th ministerial conference (MC14), to be held in Yaounde, Cameroon, in March next year, are being adversely affected by issues such as United States President Donald Trump’s proposed unilateral tariffs and reciprocal tariff plan, culminating in unprecedented uncertainty, while seemingly making the rules-based WTO redundant and ineffectual, said people familiar with the development. Already, the WTO appears to be somewhat insensitive to the developments taking place outside the headquarters of the 166-member trade body in Geneva, said people familiar with the development. There appears to be an eerie silence in the building at Centre William Rappard and very few people are found there today, said a person who visited the trade body on 10 March. As a global trade war is gradually enveloping countries based on a “tit-for-tat” retaliatory framework, the WTO’s leadership appears to be “groping in the dark” as to how to respond to the allegedly unilateral US tariffs as well as the much-anticipated reciprocal tariffs, the person said, preferring not to be quoted. President Trump has already imposed tariffs of 20% (10% last month and 10% from 4 March) on China, while pausing the 25% tariff on goods from Canada and Mexico. China has already initiated dispute settlement proceedings against the US at the WTO for allegedly violating the WTO rules, while Canada has also filed a similar complaint against the US at the WTO. China has also imposed retaliatory measures on US goods, particularly agricultural products. Besides, President Trump has threatened to impose import tariffs of 25% on cars and other auto products from the European Union. He has already declared that India has agreed to “cut their tariffs way down now because somebody [the US] is finally exposing them for what they have done,” according to media reports. (See SUNS #10179 dated 11 March 2025). With the reciprocal tariffs likely to be announced and implemented by the Trump administration against several WTO members from 2 April, the stage appears to be set for a heightened phase of legal wrangles that could sideline the regular work at the WTO on finalizing the work programme for MC14, said people familiar with the development. As the WTO’s dispute settlement system remains attenuated and the Appellate Body being made dysfunctional, it is also not clear how the likely legal battles with the US over its allegedly unilateral actions will be resolved, said people familiar with the development. Speaking at a General Council meeting on 18 February, the WTO’s Director-General, Ms Ngozi Okonjo-Iweala, seemingly avoided making any critical remarks about the US reciprocal tariff plan, which allegedly violates Articles I and II of the GATT 1994, said people familiar with the development. In her General Council statement (Job/GC/429), the DG made several comments that do not clearly indicate what the members and the organization must do in this critical hour of an existential crisis, said one person who asked not to be quoted. Ms Okonjo-Iweala, for example, said her message “remains the same and remains clear: in times of uncertainty, it is essential to remain calm, engage constructively, and avoid steps that could lead to an escalating cycle of trade restrictions.” She said, “Open and transparent dialogue is the best way to navigate challenges and prevent tensions from deepening.” However, the above remarks by the DG do not seem to address the core concerns of a country that could be adversely affected by the allegedly unilateral US tariffs, said a trade envoy who asked not to be quoted. In any case, China did not appear to take the DG’s message seriously as it launched a two-pronged strategy against President Trump’s unilateral tariffs – by imposing retaliatory measures on many US goods, particularly agricultural products worth tens of billions of dollars, and lodging a dispute at the WTO, said people familiar with the development. On how to respond to the US reciprocal tariffs, the DG’s reply was merely that “this is a Member-driven organization and Members will have exchanges with each other”, which appears to be neither here nor there. Although the WTO secretariat has updated its Tariff Analysis Online database on 4 March, it does not help members at this stage, as the US could follow an altogether different framework, said people familiar with the development. With the US having initiated its Section 301 investigations against China, which could be used more in the coming days despite its alleged inconsistency with the WTO rules, the WTO could be pushed into “a state of limbo”, said people familiar with the development. It appears to be rather futile “to remember that we are operating from a position of strength. WTO statisticians recently calculated that more than 80% of global merchandise trade takes place under MFN [most-favored- nation] tariffs negotiated within this institution”, when the US appears to be hellbent on undermining the MFN treatment framework, said people familiar with the development. USTR REPORT In the report on “the World Trade Organization at 30 and US interests” issued last month, the United States Trade Representative (USTR), Ambassador Jamieson Greer, painted a rather grim picture as to how the trade body failed to uphold American interests over the past 30 years. Surprisingly, the report did not even mention reciprocal tariffs at all. The report claimed that: “During the Uruguay Round, we were a key architect of the WTO, and since 1995, the United States has been deeply engaged in every facet of work in the organization.” It said that “despite turning 30 years old, the WTO has not matured.” “The same problems persist. The same behaviors continue to go uncorrected. The longstanding critique, and raft of proposed solutions, have not been taken seriously. In fact, the problems have only grown,” it added. The report went on to say that, “as the weak Agreement on Fisheries Subsidies and the debacle over the TRIPS waiver demonstrate, recent activities at the WTO have undermined the interests of members and made a farce of the institution.” The report said, “we must recognize that the WTO that the United States helped create is in key respects not the WTO we have today, and the WTO we have today does not further the objectives of the countries that founded it.” The seeming silence of the WTO’s leadership to such rather “damning” remarks in the report do not augur well for the organization, and could transform the WTO into a “League of Nations-type” organization, said people familiar with the development. +
|
||
