U.S. leadership in the World Trade Organization (WTO) could serve as a counterbalance to China’s growing influence. But a new poll from TradeVistas shows that first, Americans need to know why they should care about the WTO.
As World Trade Organization (WTO) members reform the global trading system, they should carry a renewed commitment to its future and a renewed vision to match that of its founders. We’ve come to rely on the WTO yet rarely stop to appreciate it. As evidenced by the results of a July 2020 TradeVistas poll, the public has very little understanding of the institution’s role.
During the Covid-19 pandemic, technology keeps the world connected and allows global trade in services to continue. The WTO outlines four modes of delivery for services trade.
The WTO Government Procurement Agreement (GPA) covers $1.7 trillion in global government procurement trade across 48 countries, including the United States. But the Trump Administration may pull out of the GPA to support “Buy American” – a move that will come with unintended consequences for U.S. businesses.
In response to WTO-illegal European subsidies to its aircraft industry, the U.S. administration is reportedly considering what is known as “carousel” retaliation against the EU – a regular rotation of goods targeted for tariffs, designed to impose maximum pain. The United States and Europe have been on this ride before.
Every policy realm has its jargon. Trade policy is no exception. The difference between a country’s weighted average bound tariff and its weighted average applied tariff is called “water in the tariff schedule”. It’s a topic of discussion in WTO negotiations over what the starting point for tariff cuts should be.
The concept of creating a generalized, non-reciprocal system of preferences for developing countries dates back to 1968. But enabling legitimate forms of discrimination has predictably had positive and negative consequences and there’s little economic data to demonstrate the programs have accrued significant benefits.
Government subsidies to fishing industries may be accelerating the depletion of fish stocks. Nearly 90 percent of the world’s fish stocks are at risk of being overfished. WTO members first started negotiating on fisheries subsidies in 2001 and have vowed to reach an agreement restraining these kinds of subsidies by the end of 2019.
When the General Agreement on Tariffs and Trade (GATT) was first agreed by 23 original contracting parties in 1947, there were no guarantees that the rules would endure. Today, WTO membership stands at 164 countries — representing collectively, more than 98 percent of global trade. But for an institution to endure, it must remain relevant.
New WTO members Afghanistan and Liberia are cheerleaders for other countries seeking WTO membership, including Iraq, Somalia and Timor-Leste. These countries are resolved to rebuild their post-conflict economies and believe that making commitments in the WTO will undergird necessary, but difficult, economic reforms at home.