| SHORTCOMINGS OF WORLD TRADE GOVERNANCE:
Contributions for the debates prior to the Buenos Aires WTO Ministerial
by Félix Peña
English translation: Isabel Romero Carranza
In addition to the results achieved in the ongoing
negotiations in Geneva under the Trade Negotiations Committee, the WTO's
11th Ministerial Conference, to be held in Buenos Aires from 11 to 14
December, provides an opportunity for prior discussions on some of the
most significant shortcomings of the global trading system.
In this sense, providing constructive ideas for the future of the
international trading system, both at the global level and in the multiple
regional and interregional spaces, can prove a valuable contribution during
the preparatory period of the Conference.
Argentina as the host country of the WTO ministerial meeting, together
with Latin American countries with a strong role in the development of
the GATT-WTO system, can play an important role in promoting such discussions.
At least three issues deserve special attention in these recommended
debates that should precede the Buenos Aires Ministerial Conference.
The first is how to make the benefits of global and regional international
trade reach broader sectors of the populations of the WTO member countries,
especially for their positive effects on job creation and social wellbeing.
The second issue relates to the necessary balance and convergence
between global rules and institutions and those resulting from the multiple
modalities of regional and interregional preferential agreements.
The third question is how to generate rules that facilitate and promote
the projection to the world of SMEs, especially those of developing countries.
Later, in 2018, following the WTO's 11th Ministerial Conference, the G20
Summit will provide another opportunity for Argentina and the region to
show their capacity to encourage debates on viable initiatives aimed at
facilitating the coordination of a global order that promotes peace and
All indicates that when the WTO's 11th Ministerial Conference takes
place in Buenos Aires between 11 and 14 December an environment of confusion
and uncertainty will continue to prevail in the world, both politically
and economically (on WTO conferences refer to https://www.wto.org/).
It is even possible that this situation has accentuated. This will also
affect the perception of the future of international trade governance
and, in particular, its rules and institutions.
Thus, the idea of the exhaustion of the global order that has prevailed
for the last seven decades will probably be reinforced. This order reflected
the distribution of power among nations resulting from the end of World
War II and subsequently of the Cold War. It also reflected the effects
of decolonization and globalization, as well as the gradual emergence
of new relevant players in the global competition for resources and markets
and, especially, spaces of power.
Such order had moments of unipolarity, others of bipolarity, and even
of "oligarchic condominium". It was then easier to identify
the country or countries that had sufficient relative power to perceive
themselves -and, above all, to be perceived- as "rule makers"
in the international system. However, in recent years it has become increasingly
difficult to identify which countries have sufficient power to agree on
rules that ensure at least a relative world order. Perhaps this is one
of the causes that can explain, largely, the atmosphere of confusion and
uncertainty that prevails in the world today.
Hence, in addition to the results achieved in the negotiations already
initiated in Geneva under the WTO's Trade Negotiations Committee (TNC)
with regard to the agenda of the Ministerial Conference and specific agreements
that may be reached -(on the role of the TNC see https://www.wto.org/)-
the Buenos Aires meeting will provide an opportunity for prior discussions
on some of the most significant shortcomings of the world trading system.
If these discussions are broad in scope, involving a significant number
of countries and actors in international trade relations, they can contribute
to generate ideas that help strengthen the effectiveness, efficiency and,
above all, the social legitimacy of what is finally agreed in December
in Buenos Aires. In this sense, bringing forward constructive ideas for
the future of the international trading system, both at the global level
and in relation to the many regional and interregional agreements, would
prove a valuable contribution in the preparatory period of the Conference.
Argentina as the host country of the WTO ministerial meeting, together
with the Latin American countries that have played a major role in the
development of the GATT-WTO system (such as Brazil, Chile, Colombia, Costa
Rica, Cuba, Mexico, Peru and Uruguay, among others), can play an important
role in the development of such debates. Today, these countries have the
possibility of developing future mutual-gain trade relations with a very
large number of countries in all regions of the world, if not with all
This poses a great challenge for the participants of the debates that
are held, who should be very different in their perspectives and interests
and should come from the political and governmental sphere as well as
from the entrepreneurial, social, academic, and action-oriented spaces
Without overlooking others, at least three issues deserve special attention
in the discussions that should precede the next WTO Ministerial Conference.
The first concerns how to make the benefits of international trade reach
broad sectors of the populations of the WTO member countries, in particular
because of their positive effects on the generation of sustainable jobs
and social wellbeing. This includes ways of involving all social sectors
in the decision-making process, both at the level of each country and
of the different international institutions and, in particular, ensuring
greater transparency in the different negotiating processes. For example,
the fact that negotiating offers are not disclosed in time or that their
real scope and the "small print" are only revealed when the
negotiations are at an advanced stage -as is the case in some ongoing
negotiations, such as those between Mercosur and the EU-, or have already
been concluded -as happened in the negotiations of the TPP-, are practices
that today can be considered obsolete. In any case, they contribute to
the skepticism and even the bad mood of citizens regarding such negotiations,
something that can be observed today in many countries.
In this sense, how to achieve a "WTO of the people" should
a priority objective, almost the main purpose of the Ministerial Conference
of Buenos Aires. It would imply taking concrete steps to eliminate the
"transparency deficits", one of the reasons that can help explain
"the anger of societies," as Enrique V. Iglesias emphasized
in his speech at the last CAF Conference and the Inter-American Dialogue
held in Washington on September 7 and 8, 2016. (On the Conference, see
and the video with Iglesias' intervention on https://www.youtube.com/watch?v=z5onbLInBvs).
Another aim would be to counteract the growing tendency to perceive globalization
and some of the free trade agreements as understandings for the mutual
benefit of the elites involved in each country, as noted by Larry Summers
(see his article "Global
trade should be remade from the bottom up" in the Financial Times
of April 4, 2016, https://www.ft.com/).
The second issue relates to how to achieve the necessary balance and
convergence between global rules and institutions -such as those of the
GATT-WTO- and those resulting from the multiple modalities of regional
and interregional preferential agreements -such as, for example, the Mercosur,
the Pacific Alliance, the EU and the ASEAN, among many others, and the
TPP and the possible interregional agreement between the Mercosur and
the EU. Otherwise, the current trends towards the fragmentation of the
international trading system, with the ensuing impact on the effectiveness
of the world order, will be difficult to avoid. In this sense, one of
the main themes to be addressed in the discussions should be how to achieve
a balance between the requirements of flexibility of the rules and institutions
operating in dynamic and complex contexts with those of predictability
necessary for the adoption of decisions for productive investment that
generate sustainable trade and employment.
The third question is how to create policies and rules that facilitate
the projection of SMEs to the world, especially those from developing
countries. The image of a WTO perceived as only benefiting large firms
from the more developed countries does not help with the necessary social
support for the world trading system. On the contrary, what is needed
is a WTO that is perceived as the place for promoting rules and institutions
that facilitate and encourage the growing internationalization of SMEs,
for example, through their insertion in transnational productive chains
that include SMEs from other countries.
In this perspective, it would be possible to discuss how to achieve a
growing interaction between the WTO and institutions such as the International
Trade Center, the FAO, the ILO and the UNCTAD, global and regional development
financing institutions, and those of the corresponding integration processes.
Such coordination could favor the promotion of different modalities of
sectoral agreements to encourage and facilitate the development of productive
networks among SMEs in different countries.
In 2018, after the WTO Conference, the G20 Summit will provide another
opportunity for Argentina and the region to demonstrate their ability
to stimulate debates on viable initiatives aimed at facilitating the conciliation
of a global order in which peace and development prevail. These two events
will require a joint contribution of the public, academic and social sectors
(especially businesses and trade unions). Perhaps achieving such a coordinated
contribution could be the main social result with political scope that
both events would produce in our country and in our region.
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Félix Peña Director
of the Institute of International Trade at the ICBC Foundation. Director
of the Masters Degree in International Trade Relations at Tres de Febrero
National University (UNTREF). Member of the Executive Committee of the
Argentine Council for International Relations (CARI). Member of the Evian
Group Brains Trust. More