Wed | Aug 5, 2020

Editorial | Who’s Jamaica backing for WTO?

Published:Friday | July 31, 2020 | 12:12 AM

Last week’s appointment by the United Nations (UN) secretary general, António Guterres, of Jamaican Pamela Coke-Hamilton as executive director of the International Trade Centre (ITC) is a timely reminder of the ongoing process to select a new head of the World Trade Organization (WTO) and the seemingly low-keyed approach of our Government to the matter.

The ITC is a subsidiary institution of the WTO and the United Nations Conference on Trade and Development (UNCTAD).

Primarily, it provides trade-related technical assistance to developing countries, aimed mostly at building capacity of their small and medium-sized enterprises for competitive engagement of the global economy. Ms Coke-Hamilton, who also served as executive director of the Caribbean Export Development Agency, will be the second Jamaican to head the ITC, following Pat Francis, between 2006 and 2013. She goes to the job after two years in charge of UNCTAD’s influential division on international trade in commodities, a position once held by the leading Caribbean development thinker, the late Alister McIntyre.

UNCTAD, the ITC and the WTO are related endeavours. While the WTO negotiates global trade agreements, polices trade rules and settles disputes, the mandate of UNCTAD/ITC, working with other international agencies, is to help developing countries maximise, and measure, benefits from international trade arrangements, especially in the context of the UN’s Sustainable Development Goals.

WORLD PRODUCTION

Before this year’s coronavirus-induced recession, which will shrink the world output by over three per cent, some estimates said that over the first quarter of the century, globalisation wrought by the WTO increased world production by more than US$850 billion annually. This translates, on average, to 4.5 per cent on the gross domestic products of member countries. The United States and China, the world’s two largest economies, and now angry protagonists in a worsening trade war, each added nearly US$90 billion a year to their economies, these analyses say.

However, while globalisation has helped countries to lift millions of their citizens out of poverty, the trade-related gains of developing countries have lagged behind expectations, exacerbated by the collapse, five years ago, of the Doha Round trade negotiations, where the issues of developing and small, vulnerable economies were supposed to be at the centre of the talks.

The stalled trade talks are worsened by the US-China trade war and America’s claims that WTO is biased against it. Americans claim that the WTO allowed China to cheat at global trade by not stopping Beijing from providing its firms with illegal subsidies, from stealing other people’s commercial secrets, and from making it difficult for competitors to enter its markets. Indeed, America has blocked the appointment of judges to the WTO’s appeal panel – which the records show had mostly ruled in Washington’s favour – making the organisation’s dispute-settlement mechanism moribund.

It is against this background, and apparently hoping to break the logjam, that the WTO’s director general, Brazilian Roberto Azevêdo, announced in May that he would step down at the end of August, a year before the end of his term, triggering the search for a successor. Eight candidates are seeking the job. In mid-July, they made presentations on the ideas for rejuvenating the organisation to the WTO’s General Council, essentially parading before the ambassadors with whom the director general will have to work. The candidates have another five weeks to make pitches to member governments before the General Council’s chairman, New Zealander David Walker, begins to consult states on whittling down the number towards a consensus candidate or final voting choices.

As we have argued before, who becomes the director general of the WTO is important. Even before the onset of COVID-19, Donald Trump’s administration had launched an assault on the system of multilateralism, the basis of the rules-based global arrangements that offers some form of protection to small, weak nations like ours. Further, Mr Trump’s ‘America First’ ideology, which is without rational or predictable principles, further weakens these protections.

In the context of the foregoing, we would expect that the Jamaican Government would be deeply engaged with domestic and regional partners, including the private sector, on what is at stake in this selection, the policy options being pursued by the administration and the relative merits of the candidates, and the kind of WTO that would possibly emerge from their leadership.

We are not aware that anything like this has happened, or is intended to – it should happen. Too much is at stake.