US lifts objections that deadlocked the WTO over its next director-general

By Peter Ungphakorn
POSTED OCTOBER 28, 2020 | UPDATED FEBRUARY 15, 2021

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On February 15, 2021, Nigerian Ngozi Okonjo-Iweala was confirmed as the World Trade Organization’s next director-general. The decision was by a consensus of the WTO’s membership. See Ngozi Okonjo-Iweala is the new WTO chief, but let’s not get carried away.

This was made possible 10 days earlier when the new Biden administration in the US announced its “strong support” for her, ending three months of deadlock.

By then, South Korean candidate Yoo Myung-hee withdrew her candidacy. By overturning the stance of the Trump administration and its US Trade Representative, Robert LIghthizer, Biden paved the way for Okonjo-Iweala to be selected by the necessary consensus.

What follows was written before the deadlock was broken.

Is the World Trade Organization choosing a saviour? Or a butler?

By Peter Ungphakorn
POSTED JUNE 8, 2020 | UPDATED AUGUST 26, 2020

Nominations closed on July 8, 2020 after one month (from June 8) for governments to propose candidates for the new director-general of the World Trade Organization (WTO). The organisation is in deep trouble and the timing looks bad although there are some pluses. But are the 164 member governments going to choose someone to rescue the WTO? Or does that overstate the powers of a person who might be better described as the WTO’s butler?

A bit of bother down at the WTO court — Why? And is it a killer? Long read

This looks at the WTO Appellate Body crisis in some depth.
A simpler version is here
.
See also:
How the WTO deals with problem trade measures—it’s not just dispute settlement and The WTO is surprisingly busy — considering it’s supposed to be dead

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Skip the updates

UPDATES

July 28, 2023 — By now, 130 WTO members (80% of the membership) were calling for Appellate Body judges to be appointed, but in the July 28, 2023 meeting the US refused for the 67th time to join consensus (see agenda). Go to the May 17, 2023 paper; WTO documents search for all versions (including possible newer ones with additional sponsors).

January 26, 2022 — Brazil moved to authorise (under Brazilian law) unilateral action against countries that lose in a panel ruling and appeal “into the void” to leave a dispute inconclusive.

Legal opinion seems to be that this could violate WTO rules, but so long as the Appellate Body was unable to function, Brazil could also appeal “into the void” any legal challenge in the WTO. “In the absence of the Appellate Body, this does not seem totally bonkers,” tweeted law professor Geert Van Calster

News of the move came from Tatiana Palermo, President of Palermo Strategic Consulting and a former Brazilian vice-minister and negotiator, who tweeted:

“Brazil’s President Bolsonaro has signed an executive order allowing #Brazil to retaliate unilaterally ([including] suspending IPR [intellectual property rights] obligations) in cases where the losing party appealed the #WTO panel ruling into the void & continues with unfair trade practices.”

The executive order is here, in Portuguese.

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October 26, 2021 — María Pagán, the Biden administration’s nominee ambassador to the WTO, told a US Senate Finance Committee hearing on her nomination that the US does want to “restore the Appellate Body”, a point that had never been clarified since the Trump administration blocked the appointment of appeals judges:

“I think there’s consensus that the WTO, and particularly the Appellate Body, need to be reformed. I guess on the other hand, we all have different views of what reform means, and particularly with respect to the Appellate Body. What we want, and if confirmed what I will work hard to do, is to have conversations so that we can restore the Appellate Body and the dispute settlement system to what we thought we had agreed to.”

To underscore that this is an official position, Henry Hodge, spokesperson of the Office of the US Trade Representative, tweeted Bloomberg’s story on the statement with the headline “Biden’s nominee to WTO wants to restore Appellate-Body function.”

Pagán’s remark came on the day the US blocked the appointment of appeals judges for the 47th time at a WTO meeting in Geneva. It was the first sign of any new thinking in Washington. But it was too late for anything to happen in time for the November 30 to December 3 Ministerial Conference.

Trade lawyer Simon Lester said the remark is “positive” but that restoring the system “to what we thought we had agreed to” may prove to be “tricky”, a point Pagán herself acknowledged.

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By Peter Ungphakorn
POSTED AUGUST 21, 2019 | UPDATED AUGUST 12, 2023

A casual glance at the headlines might have misled us into thinking the World Trade Organization (WTO) would grind to a halt at the end 2019, that the blame lay entirely with US President Donald Trump, and that the WTO’s demise would bring anarchy to world trade.

Only the last of those three assertions is possibly correct; and only if the WTO really does die — which it certainly won’t, not in the near future.

This is an attempt at an explanation. It shows that even WTO dispute settlement could well survive, but in a less powerful form. Other important work in the WTO will continue, and therefore so will the WTO itself.

But be warned: simple explanations of complex issues cannot tell the whole story. And even this attempt is not that simple. Sorry.

By Christmas 2019 the WTO was supposed to be dead — why wasn’t it? A short explanation

By Peter Ungphakorn
POSTED AUGUST 21, 2019 | UPDATED AUGUST 12, 2023

This short explanation skims the surface of some pretty complicated issues. If you want more detail, with more links and references,
then try this longer version
.
See also:
How the WTO deals with problem trade measures—it’s not just dispute settlement and The WTO is surprisingly busy — considering it’s supposed to be dead

Updates:
Brazil moves to act unilaterally, and the Biden administration signals for the first time it is willing to discuss restoring the Appellate Body

By mid 2023, 130 WTO members (80% of the membership) were calling for Appellate Body judges to be appointed, but by July 28, 2023 the US had refused 67 times to join consensus (see agenda).
The May 17, 2023 paper; WTO documents search for all versions

The doom-mongers had already written off the WTO. From December no new appeals in WTO disputes would be possible and the whole organisation would grind to a halt, they claimed. They were wrong.

The problem is with the appeals stage of WTO legal disputes. Some countries are finding ways to work around that. WTO disputes cannot be the same without a properly functioning Appellate Body, but they can continue even if the system is weaker.

As for the rest of the WTO’s work, it does not rely on dispute settlement. True, member countries participate in those functions more confidently if they know the disputes system is working well, but it will still take years before they lose confidence so badly that they give up on the WTO altogether.

UK, EU, WTO, Brexit primer — 1. WTO membership

By Peter Ungphakorn
POSTED OCTOBER 7, 2017 | UPDATED OCTOBER 10, 2017

Adam Sharpe is my editor at IEG Policy. On October 5, he emailed me. “I almost spat my coffee out,” Adam wrote, “when I turned on twitter and saw that ‘EU-UK WTO’ was trending this morning. Looks like TRQs are now ‘mainstream’.”

“EU-UK WTO” was trending because suddenly the media were reporting on some highly technical discussions related to the UK leaving the EU (Brexit) and the implications in the World Trade Organization (WTO).

Second bite — how simple is the UK-WTO relationship post-Brexit?

The first bite at the cherry is here

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By Peter Ungphakorn
POSTED AUGUST 17, 2016 | UPDATED AUGUST 20, 2016

Since the June 23, 2016 referendum, the debate about the UK’s post-Brexit status in the World Trade Organization has become more intense.

Back in March, AgraEurope’s first and detailed look at it attracted little attention (part 1 and part 2 are for subscribers; additional facts, free to view).

WTO Director General Roberto Azevêdo’s comments before the referendum did raise a few eyebrows — but not much.

IN THIS ARTICLE

ASSUMPTIONS SCRUTINISED
● Nothing simple: UK revising commitments, some transposed from EU’s | tough negotiations to keep entitlements to protect agriculture | current EU commitments not known | trade continues but possible disruptions

● Not complicated (one or several of these): “let’s be Singapore” — UK to be a free unilateral free trader (easier WTO talks) | “we need you” — other WTO members willing to accommodate UK’s demands in order to keep trading | “call my bluff” — little risk of legal challenge so UK has legal grounds to go ahead and submit its own WTO terms

● Even more complicated (one or both): “the blank paper” — UK renegotiates everything from scratch, nothing transposed automatically from EU | “accession route” — UK negotiates new commitments as if a new WTO member

PLUS What Azevêdo said

All that has changed. Demand has risen for what is now part of a special report for AgraEurope subscribers, and a debate has developed in academic and media comment, and on social media.

Nothing simple about UK regaining WTO status post-Brexit

By Peter Ungphakorn
POSTED JUNE 7, 2016 | UPDATED AUGUST 19, 2016

WTO Director-General Roberto Azevêdo has finally broken his silence over the UK leaving the EU (Brexit), first with the Financial Times, followed by Reuters, the Guardian and others. One of his key points was that the UK would face complex talks in the World Trade Organization. What did he mean?