While the trade system as a whole has proved more resilient than many feared during the Covid-19 pandemic, the crisis has placed new stresses on multilateral cooperation. This has come at a time when the standing of the WTO has fallen in some of its largest members and its rules have been ignored by many. This column argues that with the election of a new US government and the concurrent selection of a new WTO Director-General, there is new hope for a revitalisation of multilateral cooperation on trade. A new eBook presents analyses and ideas of how this could be done.

The WTO is looking for a new Director-General. This column reports on selected results of a recent survey designed to help identify what the trade community thinks is needed. The results suggest strong support for someone with managerial and political experience, and a professional network that spans international organisations, major capitals, and international business. African respondents assign the highest priority to regional diversity. Overall, there is a distinct contrast between the preferred profile and that of the incumbent.

Among its many regrettable effects, Covid-19 will also have a strong impact on international trade. Forecasting potential trade effects is important for policymaking. This column develops a range of scenarios in a dynamic CGE model to simulate possible trajectories for GDP. It then generates short-term forecasts of trade for various regions and the world using time-series analysis. The outlook for 2020 is bleak with trade possibly declining by between 13% and 32%. Some recovery is expected in 2021.

The WTO dispute settlement system is in crisis, endangering the future of the organisation. The proximate reason for alarm is the dwindling number of Appellate Body members, the result of the US blocking new appointments as the terms of sitting members expire. The crisis usually is presented as the US against the world. This column reports on the results of a recent survey of WTO Members’ perceptions of the Appellate Body and the role it plays (or should play). Responses reveal strong support for the basic design of the dispute settlement system, but also that the US is not alone in perceiving that the Body has gone beyond its mandate.

In December 2019, the WTO Appellate Body will cease to operate unless the US stops blocking new appointments. This column argues that the Appellate Body should stick to the mandate that was agreed in 1995 and not overstep it, as requested by the US. At the same time, the WTO adjudication process should be reformed by increasing the use of economics in panel reports, by improving the quality of panellists and Appellate Body members, by reducing the politicisation of appointments, and by changing the modus operandi of dispute settlement. 

Preferential trade agreements cover more than half of world trade. This column argues that while the 280 preferential trade agreements in existence have substantially widened the scope of free trade and reduced average applied tariffs, they have struggled against traditional bastions of protection in poorer countries and have not been able to eliminate the high levels of protection for a handful of sensitive products. While preference margins offered to partners in such agreements seem large, their significance shrinks when competition from both preferential and non-preferential sources is considered.

As the G20 gather in Japan to discuss options to revive the moribund WTO, Tim Phillips talks to Simon Evenett, one of the authors of the Global Trade Alert, on how the ministers can halt the "free for all" on protectionism. 

Some policymakers believe that EU competition policy prevents the emergence of industrial champions. The column argues that Europe’s competition policy has successfully contained the rise in concentration and excess profits, and the EU should not follow the US in weakening its approach. Instead, the EU needs to strengthen its trade policy to be more assertive on reciprocity in market access and control of industrial subsidies. 

As a trade war of unprecedented scope and magnitude engulfs the world’s two largest economies, this column introduces a new Vox eBook that seeks to shed light on the origins of the conflict, the current impacts on economic activity around the world, and the likely consequences for the future of globalisation. It concludes that the prospects for the future of the multilateral trading system look grim.