3 Top Risks Of the Global Trade War Solution

The solution was supposed to be the World Trade Org.  Has it managed to negotiate trade dispute solutions for waring nations?

No?  Members of the World Trade Organization (WTO) have become increasingly frustrated with all three of its main functions: monitoring member states’ trade policies, providing a forum to negotiate new trade agreements, and arbitrating trade disputes.

Why?  What are the issues?  First, two-thirds of the WTO’s 164 member states continue to claim “developing country” status, a designation that allows them to take advantage of certain benefits and exemptions to obligations not granted to advanced economies. However, economic realities suggest that many of these countries have the capacity to take on fuller obligations. For example, 10 Group of Twenty (G20) members claim developing country status at the WTO. Since the WTO allows for self-classification, there is no universal definition for developed or developing status.

Second, the WTO’s negotiating arm is atrophying. At the root of the degrading negotiating function is the difficulty for WTO members to reach a full consensus, which is required to agree to new agreements, obligations, and rule changes. The failure of many countries, including major economies like China, to comply with notification and transparency obligations has made negotiating new rules and agreements even more difficult. 

The United States, the European Union, and others have called for rules that would punish members for not complying with their transparency obligations. The consensus requirement, however, will likely present a formidable roadblock to such rules being agreed to. Certain members, including China, have taken advantage of the overall impasse at the WTO and continue to maintain discriminatory barriers against imports, intervene in markets to support state-owned enterprises, and fail to report subsidies to the WTO accurately.

Third, some countries (but primarily the United States) have concerns with the WTO dispute settlement system, the main process to resolve trade conflicts between members. Specifically, the United States is concerned the Appellate Body, which permits countries to appeal against adverse rulings, has exercised decision making and arbitration power beyond its original mandate. 

Successive U.S. administrations have claimed that the Appellate Body, through its rulings, adds or diminishes to the rights of WTO members by reinterpreting WTO agreements, despite WTO members having never agreed to those interpretations. While desire for reform is broadly shared across the WTO community, member states’ opinions and proposals on how to proceed vary significantly.

There can be no agreement between the nations, so this org. might dissolve naturally.  Or could a country take the lead and come up with something reasonable, fair and lucrative for all?  Why not take a look at other political topics?  CLICK HERE