TWN Info Service on WTO and Trade Issues (Oct26/24)
27 October 2026
Third World Network

WTO: Deep divisions persist over decision-making, development, LPF issues
Published in SUNS #10541 dated 26 October 2026

Geneva, 23 Oct (D. Ravi Kanth) -- The four facilitators overseeing the World Trade Organization reform discussions on foundational issues, decision-making, development and “level playing field” (LPF) issues - delivered their respective reports, under their own responsibility, on 22 October.

The reports reveal entrenched positions and continued opposition to the proposed changes, including disagreements over the scope, sequencing, and legal parameters of reform, according to people familiar with the development.

In a restricted document (JOB/GC/REFORM/10) issued on 22 October, the General Council (GC) chair, Ambassador Clare Kelly of New Zealand, said: “The reports are reproduced in the chronological order of the facilitated plenary meetings and group consultations held by the WTO Reform facilitators earlier this month.”

She requested members “to focus their comments at the informal Heads of Delegation meeting on 23 October on the process [of] WTO Reform, especially how we can move to more interactive and substantive discussions going forward.”

However, it remains unclear how the discussions can advance given the seemingly unbridgeable positions between a major group of industrialised countries and a majority of developing and least-developed countries.

The latter view the proposed reforms as a potential assault on the core principles of the multilateral trading system embodied in the Marrakesh Agreement, which established the WTO in 1995, said a trade envoy who asked not to be quoted.

“If continued interactive and substantive discussions are an attempt to wear down the large majority of members to forego their principled positions, then it is highly unlikely that there would be any progress,” the trade envoy said.

A cursory examination of the four reports suggests that while members have called for evidence-based assessments, focused thematic discussions and more inclusive participation, they remain divided over plurilateral agreements, most-favoured-nation (MFN) treatment, special and differential treatment (S&DT), industrial subsidies, state-owned enterprises (SOEs), agricultural trade and the role of the WTO Secretariat.

A recurring demand across all four tracks is that reform should begin with a clear diagnosis of existing problems rather than predetermined solutions, said another person who asked not to be identified.

The underlying disagreement remains whether WTO reform should primarily address perceived distortions in the global trading system or strengthen the implementation of existing commitments and the development bargain embedded in the WTO agreements.

Decision-making

During the October informal plenary on decision-making, the facilitator, Ambassador Katsuro Nagai of Japan, said, “we continued our consideration of Members’ papers and took up the guiding questions I had posed on past mandates and plurilaterals.”

China, the United Kingdom and India presented proposals addressing the issues of participation, implementation, plurilateral agreements and safeguards.

According to Ambassador Nagai, China advocated greater flexibility in participation, commitments and implementation to accommodate members’ differing capacities, alongside stronger political guidance.

China also described plurilaterals as potential “building blocks for multilateralism.”

The UK outlined five avenues for anchoring plurilateral initiatives within the WTO framework, emphasising transparency, engagement and the concerns of non-participants.

India proposed eight guiding principles and safeguards covering the entire life-cycle of plurilateral agreements, from initiation to amendment.

Despite differences, Ambassador Nagai reported that “some” members identified common ground on “transparency, inclusiveness, development and preserving consensus.”

However, his report did not identify these members or specify how many shared this assessment.

On China’s proposal, members sought clarification on how Pareto improvement and differentiation tools would work in practice to strengthen consensus-based decision-making and facilitate decision-making more broadly.

Questions also arose over who would assess the concerns of non-participants, what legal effect such assessments would have, and whether additional safeguards would facilitate consensus or introduce new conditions.

Past mandates & implementation gaps

The review of past ministerial mandates exposed another fault-line. Members welcomed a WTO Secretariat compilation of ministerial instructions and commitments, recognising that implementation gaps undermine the trust necessary for consensus.

A trade envoy who asked not to be quoted said that many members appeared to favour a diagnostic exercise examining outstanding mandates and the reasons for non-implementation as a necessary prerequisite for reform.

Ambassador Nagai reported that “some” members considered a “diagnostic exercise on outstanding mandates and the reasons for non-implementation a necessary step, cautioning against diluting or reinterpreting existing mandates.”

He added that others believed the review should inform, rather than delay, reform, arguing that a lack of progress in one area should not prevent negotiations elsewhere.

The report did not identify the countries holding these respective positions.

Suggestions included a member-driven stocktake classifying mandates as implemented, outstanding, stalled or overtaken; identifying substantive, procedural, institutional and capacity-related obstacles; and asking relevant WTO bodies to report on pending commitments.

The facilitator emphasised that “assessing the implementation or non-implementation of past mandates rests with Members.”

Without delivering on the past multilateral mandates, it remains questionable how members can agree on plurilaterals, another trade envoy said.

Plurilateral agreements & consensus requirement

Ambassador Nagai’s report on plurilaterals highlights a central division among WTO members.

Members broadly acknowledged that plurilateral agreements form part of the WTO architecture, while recognising that Article X:9 of the Marrakesh Agreement requires consensus to incorporate such agreements into Annex 4.

Echoing the positions of the United States, the UK, the European Union and the “Friends of the System” group, led by Switzerland and including Japan, Ambassador Nagai argued that excessive constraints could drive rule-making outside the WTO, according to people familiar with the discussions.

These major trading powers maintained that the organisation should make it easier to incorporate agreements already concluded under existing rules rather than create additional obstacles, people said.

Other members warned of fragmentation, adverse effects on non-participants and additional demands on WTO Secretariat resources.

Brazil, India and several other developing countries insisted that participation in an initiative did not automatically imply agreement to its incorporation and that no threshold or criterion could replace consensus.

Members also disagreed over whether those opposing incorporation should provide written explanations or justify their objections through structured consultations. Some cautioned against tests based on material harm or national interest, arguing that these matters fall within members’ sovereign prerogatives.

Ambassador Nagai called for more focused thematic discussions and consultations in smaller groups, provided that transparency, inclusiveness and effective participation were maintained.