The World Trade Organization’s decision to postpone a crucial meeting last week calls into question efforts to rehabilitate the alliance, which has been battered by years of neglect, trade wars, and the Covid-19 pandemic.
The most pressing concern was the organization’s ability to reach a global agreement this year to expand access to vaccines and, potentially, waive intellectual property rights for life-saving drugs.
More fundamentally, the delay will stymie efforts to reform a 26-year-old bureaucracy that has failed to evolve in response to massive shifts in the global economy over the last two decades and has been devoid of any teeth to enforce international trade rules.
“It doesn’t take a rocket scientist to figure out that if we can’t deliver on these critical issues, people will look for other options,” WTO spokesman Keith Rockwell told reporters last week.
“It could be in a different context, another organization, a different set of negotiations, and that would be extremely damaging to us.” So everyone has a huge stake in this.”
The Biden administration has called for a comprehensive reform of the WTO as well as a reboot of the organization’s appellate body, which previously had the final say in trade disputes involving billions of dollars.
However, the United States’ push has not resulted in action because the WTO’s 164 members cannot agree on the best way to repair the organization’s core functions.
Former Nigerian Finance Minister and World Bank official Ngozi Okonjo-Iweala, the WTO’s new leader, has urged nations to start that process by concluding three trust-building agreements at this week’s now-postponed WTO’s 12th ministerial conference, known as MC12: an agreement to curb harmful fishery subsidies; a framework to expand global trade in vaccines; and a pledge to reduce trade-distorting agricultural policies.
She argues that without an overhaul and forward momentum, governments and businesses may finally conclude that the WTO is not a credible forum for addressing their shared challenges.
During a closed-door meeting this fall, Okonjo-Iweala laid out the stakes for delegates.
The WTO conference would have been a once-in-a-lifetime opportunity for governments to demonstrate that they can make a timely impact and help improve the lives of ordinary people by expanding global access to vaccines.
Members have tried and failed for the past two years to engage in discussions on a proposal from India and South Africa to waive key aspects of the WTO’s intellectual property rules for vaccines, therapeutics, and diagnostics.
While the United States, China, and a number of other countries support the concept of an intellectual property waiver in principle, the European Union, the United Kingdom, and Switzerland oppose a waiver that they believe would do little to increase access to vaccines in the developing world.
“We remain convinced that the TRIPS waiver will result in only one additional dose of vaccine and may jeopardize existing partnerships that have allowed us to increase production,” Switzerland’s ambassador to the WTO, Didier Chambovey, told reporters last week.
The debate is especially important to Okonjo-Iweala, whose most recent position as chairwoman of Gavi, the Vaccine Alliance, places her in a unique position to address vaccine access inequity in the developing world.
“She has done quite well up to now — navigating this Covid crisis trade-wise and intellectual property-wise,” former WTO Director-General Pascal Lamy said in an interview. “She has succeeded in making the WTO appear to be a solution rather than a problem.”
International trade officials hoped that MC12 would provide a forum for trade ministers with political clout to work out side deals and reach compromises that their ambassadors in Geneva had failed to achieve.
“The WTO ministerial conference is the only time when key decision makers and those with leaders’ phone numbers come together in one place, are effectively locked in, and have to talk about their disagreements and try to forge a new path forward for international trade,” said Dmitry Grozoubinski, executive director of the Geneva Trade Platform.
While Okonjo-Iweala has stated that negotiations will continue, it is unclear whether any progress can be made on the intellectual property debate in the absence of in-person ministerial-level negotiations.