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WTO, others kick for reform in trading system

As the U.S. retreats from prior agreements, the World Trade Organization, International Monetary Fund and World Bank have called for an immediate reform in the multilateral trading system.
“The urgent challenge today is to harness the unique strength of the WTO,” the bodies said in a joint report.
“The slow pace of reforms since the early 2000s, fundamental changes in a more interconnected modern economy and the risk of trade policy reversals call for urgency to reinvigorate trade policy reforms.”
President Donald Trump has harshly criticized globalism in general and questioned America’s participation in multilateral institutions like the WTO during the United Nations General Assembly meeting in New York.
Meanwhile, fallout from the escalating U.S.-China trade conflict led the WTO to cut its trade growth forecast this week.
WTO Director-General Roberto Azevedo warned that a full-blown trade war “would knock around 17 per cent off global trade growth, and 1.9 per cent off GDP growth.”
The joint paper by the Washington-based groups outlined specific initiatives aimed at modernizing WTO rules.
They include a focus on increased market access for e-commerce, more flexible negotiating structures and better transparency of government trade policies.
The recommendations echo many goals outlined in various WTO reform proposals offered this month by the European Union and Canada.
Recognizing the dire state of the WTO, countries like Canada and the EU are preparing the groundwork to update the organization’s 23-year-old rule book.
Though both China and the U.S. endorsed the need for WTO change, they have diverse views on how to do so.
The WTO, IMF and World Bank jointly called for new rules to address the expanding role of electronic commerce along with investment and services trade in the 21st century.
“The opportunities provided by information technology and other fundamental changes in the global economy are yet to be reflected in modern areas of trade policy,” the report said.