Grand bargain needed to restore centrality of WTO, says new report
The International Chamber of Commerce (ICC) has today unveiled findings of a new report on the future of multilateral trade liberalization.
Launched on the margins of the OECD Forum in Paris this week, From Drift to Deals: Advancing the WTO Agenda, sets out a roadmap for a “grand bargain” to bring the long-stalled Doha Round of trade talks to a conclusion and restore the centrality of the World Trade Organization (WTO) as a forum for trade liberalization.
Concluding the Doha Round
The report—developed by the respected Peterson Institute think-tank—suggests that advanced economies should make “serious concessions” in the Doha Round talks to forge a deal on farm reform and market access for manufactured goods.
In return, it is suggested that developing countries should agree that new plurilateral agreements can be added to the WTO framework without the unanimous consent of all 161 member governments. This constitutional change would enable the WTO to realize its “full potential” to open-up new realms of global commerce—even though not all members may be prepared to liberalize trade and investment flows at the same pace.
ICC Secretary General John Danilovich said: “An immediate priority for all WTO members must be concluding the remaining aspects of the Doha Round. We call on governments to accelerate the ongoing negotiations aimed at paving the way for a political agreement at the WTO’s next ministerial conference in December.”
The report’s authors—Gary Hufbauer, Eujin Jung, Sean Miner, Tyler Moran and Jeffrey Schott—suggest that this change to the rule-making practices of the WTO could pave the way for the ongoing Trade in Services Agreement (TiSA) to be mainstreamed in the WTO framework, potentially delivering an annual boost to global services exports of almost US$239 billion.
Commenting on the launch of the report, ICC Secretary General John Danilovich said: “An immediate priority for all WTO members must be concluding the remaining aspects of the Doha Round. We call on governments to accelerate the ongoing negotiations aimed at paving the way for a political agreement at the WTO’s next ministerial conference in December. We hope that the new ICC report will provide an important reference point to speed those discussions.”
A new 21st Century trade agenda for the WTO
The report suggests that by 2017, WTO members could launch a new series of plurilateral deals among coalitions of the willing. A range of potential priority areas are identified, including:
- A new multilateral investment framework – the report estimates that an ambitious WTO Investment Framework Agreement could increase total inward FDI flows by 10% annually, or US$1.2 trillion based on 2012 levels.
- Digital trade and telecoms hardware – a WTO agreement in this area could establish new international rules to address data privacy and national security concerns. The report acknowledges that such an agreement would be difficult to negotiate, but notes that as an interim measure existing WTO rules could be employed to help address the growing problem of cyber-espionage.
- A new WTO code on state-owned enterprises– an issue of growing concern for many private firms, the report suggests that a new WTO code could be developed to establish rules around the operations of state-owned enterprises. This agreement could be built on existing multilateral and bilateral rules to speed its adoption.
Learn more about the ICC World Trade Agenda.
Follow ICC Secretary General John Danilovich at #OECDwk on Twitter @JohnDanilovich.