Deputy Director-General (DDG) of the World Trade Organisation (WTO), Ananbel Gonzalez, has urged developed nations to increase trade capacity building to help developing economies implement new commitments and adopt novel approaches such as the opt out technique, developed in response to the pandemic.
She added that the pandemic and the war in Ukraine have created a sense that trade openness could lead to vulnerabilities arising from trade specialisation, hence, countries are better off rolling back global supply chains. She said this was affecting developing economies more as they are at the receiving end of such trade decisions.
Although most supply chain pandemic disruptions have been resolved, heightened geopolitical tensions continue to undermine trade cooperation and worries about trade vulnerabilities, stemming from disruptions such as epidemics or natural disasters have given way to accusations of trade interdependencies being weaponised by foreign governments, she noted.
She added that subsidies and other trade-distorting industrial policy instruments, sometimes put in place in the name of national security, have made a comeback, bringing with them greater policy uncertainty, potential disregard for global trade rules and shrinking trade and investment opportunities, especially for poor countries at the margins of the global economy.
Amid this big player politics, many developing and least-developed countries, including Nigeria, prefer not to take sides and continue to look for ways to leverage the trading system to integrate further into global markets.
In addition to dispute settlement, Gonzalez said managing the negative spillover effects of rising subsidies and the increased use of the national security exception to explain trade actions are also critical and dealing with diverging approaches to trade measures aimed at combating climate change is also key. “Managing the adoption of increased responsibilities by larger emerging markets in the multilateral trading system is required, as are greater efforts to better integrate those currently marginalised from the benefits of trade. In this context, members would be well served by a world trade body that provides enhanced monitoring and transparency.”
To achieve these, she said, the present multilateral trading system needs to be updated in order to unleash new sources of trade growth to harness its potential, resolve challenges of the global common economy and manage trade tensions.
