Ho Wai Man. The 13th Ministerial Conference of the World Trade Organization (WTO) will be held in Abu Dhabi, the capital of the United Arab Emirates, from February 26 to 29. As the first ministerial conference after the launch of the WTO reform, what progress can be made in the WTO reform at this session will have great implications for the future reform process.
The first and most urgent task of WTO reform is to resolve its own existential crisis. In recent years, a small number of countries have put their laws above international law and arbitrarily adopted large unilateral tariffs and other restrictive measures. According to a December 2023 report by the United Nations Conference on Trade and Development (UNCTAD), 5,400 restrictions were introduced each year between 2020 and 2022, double the number before the pandemic. The "CHIPS and Science Act" and the "Inflation Reduction Act" promulgated by the United States, as well as the construction of a "values-based" and "resilient" chain in the name of "**", and the promotion of "friendly outsourcing" and "nearshoring", directly shake the principle of unconditional non-discrimination in the multilateral system. And the appellate body of the WTO's dispute settlement mechanism, the tooth of the WTO's enforcement rules, was forced to suspend due to Washington's obstruction. The WTO, which was established on the basis of a system of rules for world freedom, is in danger in the face of increasing anti-globalization and unilateralism, but lacks strong consensus and means of maintenance.
The objectives of this ministerial meeting are to strive for new results in the first negotiation, and the adoption of the "Fisheries Subsidies Agreement" by the 12th Ministerial Conference is a major achievement. The Agreement will not enter into force until ratification by 2.3 of the 164 members, less than half of whom have ratified the agreement, and a strong impetus is needed at this session. If new progress is made in the negotiations on the abolition of export subsidies for agricultural products and the launching of negotiations on e-commerce rules, the authority of the WTO in formulating multilateral rules will also be strengthened. Dealing with the suspension of the dispute settlement mechanism is the key to whether the WTO can enforce discipline and enhance the effectiveness of the multilateral mechanism.
As the challenges to global governance continue to grow, the WTO needs to play a greater role in global governance. Enhancing its collaboration with other international organizations is also an urgent agenda. During the global fight against the pandemic, the WTO and the WHO successfully cooperated to reach an agreement on intellectual property waiver for COVID-19 vaccines and facilitate faster delivery of vaccines to developing countries. The outbreak of the Russia-Ukraine conflict has caused serious food disruptions, and many low-income countries are at risk of food shortages, and the WTO has adopted an agreement to remove food export restrictions in a timely manner. During the 28th Conference of the Parties to the United Nations Framework Convention on Climate Change, the WTO held the "Friends of Climate" event to actively participate in the global joint efforts to combat climate change. This session will undoubtedly take stock of these positive outcomes and give new impetus to WTO reform in this regard.
On the eve of this session, Dombrovskis, executive vice president and member of the European Commission, expressed the hope that China will actively participate in the WTO reform, especially in the area of industrial subsidy policies. Regulating industrial subsidy policies is undoubtedly a requirement of a transparent and non-discriminatory multilateral system. But what currently distorts this system is, first of all, the country-specific discrimination and chain segmentation brought about by the division of geopolitical camps, implemented by the abuse of the *** exception clause. The WTO needs to develop clear, non-discriminatory standards and rules on the boundaries of exceptions, and introduce corresponding penalties.
In terms of regulating industrial subsidies, it is first necessary to continue to solve the biggest distortion of world goods, that is, subsidies for the export of agricultural products. The 10th WTO Ministerial Conference held in Nairobi in 2015 reached an agreement on the elimination of unreasonable export subsidies for agricultural products, but due to the negative attitude of major agricultural countries, no new progress has been made in the relevant agreements. Both the United States and the European Union should take concrete action. With the continuous development of generative AI, big data, supercomputing, etc., many countries have formulated industrial support policies, which are very different from those in the early stage of industrialization. In order to adapt to the rapid development and transformation of the world's science and technology and industry, the industrial subsidy rules regulated by the WTO also urgently need to keep pace with the times.
Therefore, the WTO should promote plurilateral negotiations on industrial policy and subsidies in a timely manner and strive for an early agreement, as was the case with the 2015 agreement on the expansion of the Information Technology Agreement. All WTO members, especially the major industrial countries, should actively participate. There are two basic principles here. First, the principles of openness, transparency and non-discrimination of multilateral** rules must be recognized. The application of all industrial policies should be applied to all WTO members without discrimination. Without this premise, it is difficult to reach a meaningful agreement; Or even if it does, it's hard to comply. Second, the principle of differential treatment. There should be differences in conditions between developed and developing countries, especially for low-income developing members.
Globalization is facing headwinds, but its tide will not change. We hope that, through the joint efforts of all members, the 13th WTO Ministerial Conference can achieve positive results, inject new strength into the defence of multilateralism and bring new hope to the process of globalization. (The author is the executive director of the China WTO Research Association).