In One Sentence

• The World Trade Organization’s (WTO’s) 13th ministerial conference (MC13) will be held from February 26-29 in Abu Dhabi, United Arab Emirates.
• WTO Director-General Ngozi Okonjo-Iweala identified a “relatively positive tone” in the lead-up negotiations to MC13, while WTO Deputy Director General Angela Ellard said the atmosphere is even more “constructive” compared to the lead-up to MC12.
• Meanwhile, U.S. Trade Representative Katherine Tai acknowledged the positive “feeling” but cautioned that progress at the WTO is “not going to be easy” and requires “pragmatism” and “incremental” steps.
• Several officials, like former longtime WTO spokesman Keith Rockwell, have pointed out the difficulty in reaching agreements in fishery subsidies and on e-commerce.
• The co-convenors of WTO’s e-commerce initiative concluded a new draft text to reflect consensus on several e-commerce matters, including a permanent moratorium on customs duties on electronic transmissions.
• The e-commerce draft text does not include proposals on cross-border data flows, data localization, and source code and leaves out some discussions related to ICT products, electronic payments and development. 

Mark the Essentials

• According to the WTO’s schedule, a significant number of meetings will focus on issues such as dispute settlement reform, e-commerce, and trade-related intellectual property rights, while preparatory works in the lead-up to MC13 were tense on issues such as fisheries subsidies and (agricultural) public stockholding.
• In a web post on the upcoming MC13, the U.S. Chamber of Commerce’s John Murphy called first for the continuation of the “e-commerce moratorium;” a two-decade-old moratorium against imposing any customs duties on cross-border electronic transmissions. According to Murphy, the e-commerce moratorium is “one of the biggest drivers of growth in the world today.” The chamber’s call to extend the moratorium was later supported by a group of 22 major U.S. business groups. 
• In the course of finalizing preparations for MC13, WTO members agreed to a final report which states that no consensus has been reached regarding whether to expand the TRIPS waiver for COVID-19 vaccines to also cover tests and treatments. WTO members agreed in June 2022 to ease certain intellectual property requirements under the TRIPS agreement for COVID-19 vaccines but have been divided on whether to expand this waiver to also cover COVID-19 diagnostics and therapeutics.
• In a February 6 article on the WTO and the upcoming MC13, former WTO director and spokesperson Keith Rockwell estimated that given his current reading of the negotiations, MC13 will not deliver any concrete deal on agriculture, fisheries subsidies, e-commerce moratorium extension or WTO reform “unless things turn around quickly.” According to Rockwell, despite general understanding that the listed issues need to be addressed, the United States has shown limited commitment to secure concrete progress, and WTO members have yet to form a consensus on these matters.
• During a U.S. House Ways & Means Committee’s subcommittee on trade hearing, Hogan Lovells partner Kelly Ann Shaw told lawmakers that “there is very little, if anything, on the MC13 agenda that will advance U.S. interests.” Former Deputy U.S. Trade Representative and U.S. Ambassador to the WTO Dennis Shea argued that the WTO was “fundamentally flawed” and that aside from the extension of the e-commerce moratorium, “less ambitious” MC13 outcomes are “perfectly acceptable” from the U.S. perspective.

Keeping an Eye On…

• Trade liberalization, memorialized in successive multilateral trade rounds, was a transformative force for good during the latter half of the 20th century. The twenty-fold increase in international trade was pivotal to the leap in global incomes and standards of living. Even in the post-Cold War period, the four-fold reduction in poverty worldwide can be traced to trade, as low-and-middle income countries doubled their share of global trade. What a pity, then, that almost 25 years into the 21st century, the WTO had failed to conclude any significant market-opening agreement—be it via the single undertaking approach or other bespoke approaches. And what a pity, equally, that, almost 25 years into the 21st century, the WTO’s unwieldy membership is struggling to tie-up loose ends on a low-octane agreement representing second-order 20th century trade policy issues (reining in fisheries subsidies more comprehensively; extending the e-commerce moratorium; extending the TRIPS waiver to cover COVID-19 diagnostics and therapeutics) in the run-up to the WTO’s thirteenth ministerial conference (MC13) in Abu Dhabi. An agreement to incorporate the July 2023 Investment Facilitation Agreement into the WTO’s legal architecture and the admission of two LDC countries, Timor Leste and Comoros, is expected to be announced at MC13. As for the most consequential 20th century trade policy issues—the gusher of trade-distorting domestic agricultural subsidies (spending on ag. subsidies outrank fisheries subsidies by a factor of 10) and the broken dispute settlement system—solutions seem nowhere to be found. The former is not even on the conference agenda. And as to when 21st century inter-governmental trade multilateralism will get down to addressing the actual and pressing 21st century trade policy challenges—new disciples on trade and environment in this age of climate crisis; new rulemaking on trade’s nexus to the Article XXI national security exception; comprehensive rulemaking on industrial subsidies—that prospect remains as distant as ever. The e-Commerce Joint Statement Initiative is a relative break from this pattern. WTO-centered trade multilateralism has been likened to the canary in the coalmine of global economic governance. While this trade multilateralism is not about to break down completely, its political inability to tackle the plain 21st century trade challenges in, well, this 21st century bodes poorly for the future of global economic governance.      

Expanded Reading

• Fisheries subsidies chair circulates draft text to ministers as basis for MC13 negotiations, World Trade Organization, February 16, 2024
• Agriculture negotiations chair circulates revised text, aiming for outcome at MC13, World Trade Organization, February 16, 2024
• US trade chief looks for incremental reform at WTO meeting, Reuters, February 14, 2024
• Big trade deals likely elusive at WTO meet in Abu Dhabi, France 24, February 13, 2024
• 3 Business Priorities for the WTO’s 13th Ministerial Conference, U.S. Chamber of Commerce, February 6, 2024
• A moment of truth for the WTO, Hinrich Foundation, February 6, 2024