A World Trade Organization for the 21st Century: The Asian Perspective ed. by Richard Baldwin, Masahiro Kawai and Ganeshan Wignaraja (original) (raw)
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AARF, 2014
WTO, in the present shape as a main forum for trade organizations and the most effective mechanism for litigating trade disputes, has been hailed as one of the most successful post-World War II international organizations. However, ten years after its successful institutionalization, and with an uncertain outcome for Doha round of negotiations, repeated calls are being made in favour of the needs for rediscovering the path leading to consensus building and transparency-enhancement. Still member countries are having divergent views on Doha Round and are not agreed upon. At present WTO is facing numerous issues and challenges, which needs solution, otherwise it may derail. In the present paper an attempt has been made to know various issues and challenges, which WTO is confronting.
1. The transformation of international trade • The rapid reduction in the cost of distance has undermined the traditional paradigm of trade openness. • The mercantilist principle of reciprocity that underpins the prevailing global trade regime is declining in validity. • The gradual decline in tariffs has seen a corresponding increase in regulatory barriers; advanced economies tend toward more regulation, but must strive to reduce the differences between such standards. • Upward regulatory convergence can lead to the establishment of new global standards; certain countries are better poised to adapt to this new reality. • The current regulatory apparatus focuses primarily on important restrictions and remains ill-suited to potential restrictions on the export of natural resources. 2. Emerging countries are changing the picture • The rise of emerging countries has profoundly changed the agenda and distribution of major players in the GATT negotiations. • There is no natural trade coalition among emerging countries, but the non-aligned G20 as led by Brazil during the Doha round has often served to represent all developing countries. • In reality, existing trade coalitions defy geographical, political, and thematic categorisation. The new play-ers' influence is more closely related to their trade openness than their GDP levels. • China has paid a high price for its membership in the WTO, and has substantially opened itself to global trade despite considerable resistance on the domestic front. Two considerable obstacles remain: the Chinese subsidisation of capital and the lack of agreement of public procurement. • The United States' weight has decreased as that of emerging countries has grown. Its increased focus on domains where its influence remains strong, but domestic political divisions threaten its future trade treaties. The European Union faces its own unique challenges in reaching agreements both with the US and with emerging countries. 3. What governance in order to make better progress? • The global package approach to trade negotiations suffers from excessive complexity and excruciating sluggishness. WTO governance must be improved; the development and enforcement of rules by member countries is crucial to maintaining its effectiveness. • The WTO's adoption of supplementary monitoring mechanisms during the global financial crisis helped to prevent a significant increase in protectionism. • The WTO's secretariat requires greater room for manoeuvre as it facilitates increasingly complex and sensitive trade negotiations.