Wanted: New head of WTO

World Trade Organization Director General Roberto Azevedo (left) will leave behind multiple issues, including an increasingly belligerent trade war between the US and China. (AFP)
Short Url
Updated 22 May 2020

Wanted: New head of WTO

  • Requirements: Must thrive under global pressure, embrace conflict resolution, and be able to handle big egos

GENEVA: Against the backdrop of a pandemic, recession, US-China tensions and rising protectionism, the World Trade Organization (WTO) needs a new leader. Only the resilient should apply.

Brazilian Director General Roberto Azevedo surprised the WTO’s 164 members last week by announcing he would quit at the end of August, a year earlier than expected, adding to the tumult facing global agencies amid a backlash against globalization.

The Geneva-based body needs a successor by the time Azevedo leaves, or at least by December, when it is set to go into overdrive on a series of issues ahead of its biennial conference in 2021.

That’s a tall order for an organization that hasn’t produced any major international accord in years and decides its chief by consensus.

Even though the WTO is member-led, a strong, charismatic leader is seen as crucial, particularly when the global coronavirus-hit economy faces its worst recession in almost a century and US-China tensions are resurgent.

“These are unprecedented times and the WTO will need a new playbook if it wants any serious role in rebuilding the global economy,” said Kelly Ann Shaw, a partner at Hogan Lovells and a former senior White House official who worked for the US Trade Representative during Azevedo’s selection. “What the WTO really needs is a reformer.”

Over 100 trade barriers have been erected since the coronavirus outbreak. Some states are questioning their reliance on other countries, notably China, for supply. US President Donald Trump has ramped up his criticism of the WTO and the World Health Organization (WHO), which he says are too favorable to China. He described the WTO last week as “horrible.”

The WHO has rejected criticism it is too close to Beijing. The WTO has not commented.

The US and China, which reached a “Phase 1” trade deal in January, appear back at war, with Washington seeking to block chip supplies to blacklisted telecoms giant Huawei.

The US already crippled the WTO’s ability to intervene in trade wars in December after blocking appointments to the WTO body that rules on appeals in disputes.

Spokesman Keith Rockwell admitted the Director General’s role was “one of the most difficult and demanding jobs there is” with a “daunting dossier” of issues.

“But we have clear procedures and I’m sure we will get some outstanding candidates so hopefully things will go smoothly,” he said.

With three of the previous six incumbents from Europe, and the others from Thailand, Brazil and New Zealand, there is pressure to choose a leader from Africa.

Bill Reinsch, a former US Commerce Department official now with the Center for Strategic and International Studies, said there were four possible contenders from Africa: Hamid Mamdouh, an Egyptian attorney at King & Spalding LLP and former WTO official; Yonov Frederick Agah of Nigeria, a WTO deputy director-general; Eloi Laourou, Benin’s ambassador to the UN, and Amina Mohamed, a former Kenyan ambassador to the WTO and now the country’s sports minister.

Agah, Laourou and Mohamed did not immediately respond to requests for comment. Mamdouh confirmed his candidacy to Reuters, saying it was backed by Egypt’s government.

“The issue, as always with Africa, will be whether they can unify behind a single candidate,” Reinsch said.

Previous selections for WTO boss have involved what some former officials describe as a “beauty pageant” involving public events and visits for members to vet candidates.

The coronavirus makes such in-person meetings difficult and virtual meetings in the past month at the WTO have suffered from frozen screens and garbled messages.

Other global bodies like the UN have switched to written votes, but WTO members have thrown in the towel, saying formal decisions can not be made online or in writing.

The formal nomination of candidates has not yet begun but the WTO will wants to avoid a repeat of 1999, when New Zealander Mike Moore and Thailand’s Supachai Panitchpakdi split the vote.

Rohinton Medhora, president of Canada-based think tank the Center for International Governance Innovation, said there would be a “tremendous clash” if Washington and Beijing proposed candidates or sought to play prominent roles in the selection.

A spokesman for China’s foreign ministry said it would defer to “the relevant departments” on the specific task of searching for a new chief and would “maintain close communication and coordination” to ensure a smooth handover.

The US Trade Representative’s office declined to comment, referring to a previous statement from representative Robert Lighthizer saying the US looked forward to participating in the process.

The divisions are not only between Washington and Beijing.

Europe is challenging import tariffs on steel and aluminum imposed on the basis of “national security” by Trump.

National security has also been invoked by Japan in curbs of high-tech exports to South Korea, in a trade dispute between Russia and Ukraine, and a WTO case brought by Qatar against Bahrain, the United Arab Emirates and Saudi Arabia.

 


Pandemic to keep Asia’s growth at lowest since 1967, warns World Bank

Updated 29 September 2020

Pandemic to keep Asia’s growth at lowest since 1967, warns World Bank

  • The bank said the region this year is projected to grow by only 0.9%, the lowest rate since 1967
  • The rest of the East Asia and Pacific region was projected to see a 3.5% contraction

TOKYO: The coronavirus pandemic is expected to lead to the slowest growth in more than 50 years in East Asia and the Pacific as well as China, while up to 38 million people are set to be pushed back into poverty, the World Bank said in an economic update on Monday.
The bank said the region this year is projected to grow by only 0.9%, the lowest rate since 1967.
Growth in China was expected to come in at 2% this year, boosted by government spending, strong exports and a low rate of new coronavirus infections since March, but held back by slow domestic consumption.
The rest of the East Asia and Pacific region was projected to see a 3.5% contraction, the World Bank said.
The pandemic and efforts to contain its spread led to a “significant curtailment” of economic activity, the report said.
“These domestic difficulties were compounded by the pandemic-induced global recession, which hit EAP (East Asia and Pacific) economies that rely on trade and tourism hard,” it said.
Countries in the region may need to pursue fiscal reform to mobilize revenue in response to the economic and financial impact from the pandemic, while social protection programs can help support workers’ integration back into the economy, the Washington, DC-based bank said.
“Countries with well-functioning social protection programs, and good implementation infrastructure, pre-COVID, have been able to scale up more quickly during the pandemic,” it said.
The economic shock of the pandemic was also expected to lead to a jump in poverty, defined as income of $5.50 a day, the bank said, adding that based on past experience and the latest gross domestic product forecasts, poverty could expand by 33 million to 38 million people to see its first rise in 20 years.
The bank said that 33 million people who would have in the absence of the pandemic escaped poverty would remain in it this year.
“The region is confronted with an unprecedented set of challenges,” said Victoria Kwakwa, vice president for East Asia and the Pacific at the World Bank.
“But there are smart policy options available that can soften these tradeoffs — such as investing in testing and tracing capacity and durably expanding social protection to cover the poor and the informal sector.”