The WTO’s dispute settlement procedure was set up to help governments challenge policies that contravene WTO agreements. This column argues that two recent cases show that cases can be settled without resolving the problem and sometimes at the expense of other trading partners. This is an abuse of the system and a step backwards for the world trading system.
Simon J Evenett, Alejandro Jara , Tuesday, December 9, 2014
Jayant Menon, Monday, November 10, 2014
With WTO trade talks on the brink of failure (again), global trade governance is being decided elsewhere. This column argues that China and the US are pushing competing visions for free trade in Asia-Pacific. The US-led Trans-Pacific Partnership, TPP, could be challenged by a China-led ‘Beijing Road Map’ that may be announced at this week’s APEC summit. Neither vision is an end-game but merely one more stroke on an ugly picture of trade agreements characterised by an unsustainable amount of disorder and incoherence.
Bernard Hoekman, Christopher Findlay, Wednesday, September 24, 2014
The evolution of the world trading system no longer supports the delivery of opportunities that follow from innovations in international business. This column is a statement by participants at a roundtable held in the EU Centre for Global Affairs, University of Adelaide, on 22 August 2014, which offers suggestions to improve global trade governance. Given that Australia is hosting the G20 Summit in November, the roundtable focused on actions that the G20 should consider to help attain its objective of boosting global growth performance.
Jeffrey Frankel, Tuesday, September 9, 2014
Subsidies for food and energy are economically inefficient, but can often be politically popular. This column discusses the efforts by new leaders in Egypt, Indonesia, and India to cut unaffordable subsidies. Cutting subsidies now may even be the politically savvy choice if the alternative is shortages and an even more painful rise in the retail price in future. Ironically, it is India’s new Prime Minister Modi – elected with a large electoral mandate and much hype about market reforms – who is already shrinking from the challenge.
Chad P Bown, Kara M. Reynolds, Sunday, August 10, 2014
WTO dispute settlement is well-known for its high-profile cases – e.g., US-EU clashes over bananas, hormone-treated beef, genetically modified organisms, subsidies to Boeing and Airbus, etc. – some of which cover annual trade in the billions of dollars. Are the trade stakes from such disputes representative of the WTO caseload? This column presents evidence from a newly available data set and reveals some surprising facts about the prevalence of both large and small WTO disputes.
Bernard Hoekman, Petros C. Mavroidis, Wednesday, July 16, 2014
The proliferation of trade ‘clubs’ indicates that governments are keen on engaging in trade liberalisation. This column argues that the creation of new trade clubs under the umbrella of the WTO is inevitable. Such issue-specific (plurilateral) agreements keep the cord with the WTO tight, while allowing countries to cooperate on issues outside of WTO’s grounds.
Susan Ariel Aaronson, Monday, July 14, 2014
The internet promotes educational, technological, and scientific progress, but governments sometimes choose to control the flow of information for national security reasons, or to protect privacy or intellectual property. This column highlights the use of trade rules to regulate the flow of information, and describes how the EU, the US, and their negotiating partners have been unable to find common ground on these issues. Trade agreements have yet to set information free, and may in fact be making it less free.
Jayant Menon, Monday, June 9, 2014
With the rise of mega-regional trade agreements, the world trade system resembles a jigsaw puzzle. This column discusses the difficulties involved in consolidating free trade agreements at the regional level, and argues that piecing together the blocs around the world will be even more challenging. A potential way forward is to return to the most widely used modality of trade liberalisation – unilateral actions – but this time involving the multilateralisation of preferences rather than unreciprocated reductions in tariff rates.
Anabel González, Thursday, May 29, 2014
Mega-regional negotiations will underwrite global governance on 21st-century trade issues and facilitate the proliferation of global and regional value chains. This column writes that Latin American countries would gain from a strengthened and effective WTO to help mitigate the friction and fragmentation that may result from the mega-regionals.
Bernard Hoekman, Monday, May 19, 2014
The World Trade Organisation is one of the most successful instances of multilateral cooperation post-WWII. Yet WTO negotiators have yet found a way to break the recent deadlock on key elements such as the market access and rule-making dimensions on the agenda since 2001. This column introduces a new CEPR book that suggests the adoption of a ‘supply chain framework’ that could help to mobilise greater support for concluding the Doha Round and provide a basis to use the WTO as a forum for learning from regional initiatives.
Diego Bonomo, Saturday, March 1, 2014
When a dispute in the WTO does not reach any resolution, the offended member country can request the right to retaliate against the offender. This column reviews the profile of most common retaliation-requesting members. There is a preference among certain countries to either pursue retaliation, or resist compliance. The magnitude of requests and the means of retaliation are also discussed. Overall, requesting retaliation is an important tool of analysis, as it often reveals a country’s goals in the WTO disputes.
Gary Horlick, Friday, January 31, 2014
World-leading trade lawyer, Gary Horlick, talks to Viv Davies about the 2013 WTO Bali ministerial conference and the post-Bali agenda. Horlick discusses food security, agriculture and whether mega regional trade agreements pose a threat to the future of the WTO. They also discuss the potential benefits of the post-Bali agenda for developing countries and the ‘trade transforming’ effect of SMEs and the internet. The interview was recorded in January 2014.
Alejandro Jara , Saturday, January 25, 2014
Alejandro Jara talks to Viv Davies about the 2013 WTO Bali ministerial conference and the recent Vox report, ‘Building on Bali’, co-edited with Simon Evenett. Jara presents his views on the post-Bali agenda, mega regional trade agreements and trade protectionism. They also discuss the extent to which the ‘global value chain revolution’ has changed the nature and focus of international trade and trade agreements. Jara concludes by presenting policy recommendations for the way forward. The interview was recorded in January 2014.
Richard Baldwin, Monday, January 20, 2014
The global value chain revolution has changed trade and trade agreements. Trade now matters for making goods as well as selling them. Trade governance has shifted away from the WTO towards megaregional agreements. This column argues that 21st-century regionalism is not fundamentally about discrimination, and that its benefits and costs are best thought of as network externalities and harmonisation costs respectively. More research is needed to determine how the megaregional trade agreements across the Pacific and Atlantic will fit with the WTO.
Pascal Lamy, Wednesday, December 18, 2013
The emergence of intra-firm trade as the primary component of international trade reflects a global interdependence in the production process. In this column the former Director-General of the WTO argues that this necessitates a re-examination of how we think about – and how we measure – trade between nations. Interdependence allows different sectors to add value, and complicates the implementation of trade barriers. Only with a modern perspective can effective trade policy be conducted.
Simon J Evenett, Alejandro Jara , Wednesday, December 18, 2013
The recent Bali Ministerial Conference was successful enough to ensure that the WTO lives to fight another day. This column introduces a new VoxEU eBook exploring how the WTO can make the most of this opportunity to restore its central place in world trade governance.
Richard Baldwin, Thursday, December 12, 2013
The WTO signed a mini-package of trade initiatives in Bali last week. This column argues that the ‘Bali package’ is welcome but not enough. Without some new initiative or direction, the WTO looks set to drift for the next few years. The WTO cannot move ahead until the trans-Pacific and trans-Atlantic ‘mega-regionals’ are done or dead. In the meantime, the WTO should promote research and discussion on how 21st-century trade issues could be brought into the WTO when the time is ripe.
Bernard Hoekman, Jesper Jensen, David Tarr, Friday, November 29, 2013
Two regional trade agreements are centre of attention in Ukraine: the Deep and Comprehensive Free Trade Agreement with the EU – that for the time being Ukraine has rejected – and the Eurasian Customs Union with Russia, that Ukraine has been invited (or pressured) to join. Rather than choosing between the two, Ukraine should focus on reducing policy frictions that negatively affect trade through processes that mobilise firms and industries on both sides of the border. The recent proposal by Ukraine to establish a joint commission among Ukraine, Russia and the EU to promote trade could be a step in this direction.
Kyle Handley, Nuno Limão, Saturday, November 23, 2013
The impact of policy uncertainty on economic activity is potentially important, but controversial because it is hard to identify and quantify. Recent research provides a framework to identify the impacts of policy uncertainty on firm decisions, and finds it has strong effects in the context of international trade. China’s WTO accession secured its most-favoured nation status in the US, and the evidence shows this reduction in uncertainty can explain a significant fraction of its export boom to the US.
Matthias Helble, Ganeshan Wignaraja , Wednesday, November 13, 2013
Intensifying negotiations leading to the December WTO Ministerial Conference in Bali have renewed optimism for concluding the beleaguered Doha Round and boosting Asia’s trade. Agreement in Bali on tariff-quota administration, trade facilitation, and food security would improve the prospects for a Doha deal and WTO credibility. Failure at Bali, however, would spur the rise of mega-regional trade agreements – to the detriment of countries outside these agreements.