The World Trade Organization (WTO) is already 26 years old and it has sadly been through a rut in the last few years. The presidency of Donald Trump and Brexit turned the tide of the free trade mantra that had reigned for a couple of decades. Even when Donald Trump was voted out, and the Brexit drama seems to have turned the page. It is very unlikely that free trade will be again a winning proposition politically.
Still, the future of trade is not entirely bleak. We should be ecstatic that the WTO has now a new competent Director-General in Ngozi Okonjo-Iweala to lead it towards some of its However, for years it has been obvious that the Organization requires a reform that allows its rules to be updated to include new disciplines in areas not yet covered, such as digital trade or investment facilitation, among others.
Mrs. Okonjo-Iweala will not be able to do this on her own, she will need to muster goodwill from the US and China who see the WTO stalemate as part of a larger geostrategic rivalry. Aside from her own maneuvers, she needs support from a “coalition of the willing” and to this effect, she can tap into the work that the Ottawa group has already been advancing.
In 2008, Canada invited a group of countries to discuss a roadmap for the reform of the WTO, equip it with tools to address the challenges of 21st century, make trade more predictable and less prone to be a hostage of geopolitical whims from hegemonic powers.
This group includes Mexico, Australia, Brazil, Canada, Chile, South Korea, Japan, Kenya, New Zealand, Norway, Singapore, Switzerland and the European Union, but excluded both China and the US. The Ottawa Group meets regularly at ministerial and vice-ministerial levels, and functions as a laboratory to explore ideas and proposals, which can eventually be presented to the rest of the membership for discussion and eventual approval.
This is the right path to promote a trade framework that is stable, and even if new liberalization might be off the table, at least we can work to secure gains and modernize on disciplines that are new such as electronic trade.
The pandemic has also made salient that when push comes to shove, countries that control supply chains have the upper hand, particularly in regard to health. The US for instance is not being especially generous in the international vaccine distribution, even if President is saying all the right words expressing to the International community that the “US is back”; the European Union has also been toying with the implementation of export restrictions.
Therefore, more work on trade and health is in everybody’s interest. Developing countries should be able to have more access to products defined as essential by the World Health and Customs Organizations, especially during a critical situation like the one we are experiencing. Mexico’s participation in the Ottawa Group contributes to advancing a much-needed reform of the WTO and submitting proposals that help face the current and future challenges presented by international trade.