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Global South should make concerted efforts to ensure a more equitable, reasonable and inclusive WTO through reform

By ZHANG JIANPING | China Daily Global | Updated: 2024-02-26 08:02
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Global South should make concerted efforts to ensure a more equitable, reasonable and inclusive WTO through reform

The rise of unilateralism and protectionism in recent years has triggered an increasing number of trade disputes, bringing uncertainty to global trade and threatening global economic stability and the multilateral trading system.

As the primary international trade governance platform, the World Trade Organization plays a crucial role in maintaining a fair, open and sustainable environment, providing a solid foundation for the development of the global economy and trade.

The WTO also keeps a close eye on developing countries and actively promotes the development of the Global South. In the Uruguay Round of trade negotiations, the WTO established principles such as tariff reduction and service trade liberalization, which laid the foundation for developing countries to take part in international trade. With development in mind, in the Doha Round, the WTO proposed agricultural subsidy reductions and other actions that would benefit the developing economies, although agreement was not reached between the developed and the developing countries.

The Western countries, particularly the United States, have always put their own interests above others. They abide by international trade rules only when the rules meet their needs. They have even disrupted and obstructed the WTO's dispute settlement system, severely undermining the authority and effectiveness of the WTO. Without timely and effective measures, multilateral trade systems, including the WTO, risk losing their guiding role in global trade and their rule-making powers.

As a collective of emerging and developing economies, the Global South has played a significant role in promoting WTO reform and safeguarding the interests of developing countries. China's WTO reform proposal firmly upholds the rules-based multilateral trading system, adheres to openness and cooperation, and supports the status and rights of Global South countries in international trade.

Reflecting the interests and needs of the Global South, the proposal aims to make the multilateral trade system more inclusive and sustainable. China's Position Paper on WTO Reform sets out three basic principles: WTO reform should uphold the core values of the multilateral trading system, safeguard the development interests of its developing members, and adhere to the mechanism of decision-making through consensus.

Based on these principles, the Global South can promote the reform of the WTO in the following ways.

First, collaborate to enhance negotiating power.

Globalization has increased the interconnectivity among countries and the overall strength of developing economies. However, with dominating powers in the world economy and politics, developed countries are attempting to impose various restrictions on the Global South to maintain and consolidate their own advantages.

The Global South should adhere to the principles of multilateralism and consensus, and strongly oppose the unilateralism and protectionism of developed countries that put their interests above anything else.

It is essential to uphold the authority and effectiveness of the WTO. In particular, the WTO dispute settlement system needs to return to normal operation as soon as possible so that international trade disputes can be resolved within the WTO framework.

Additionally, the Global South should present a unified stance to urge developed countries to abide by the rules and fulfill their commitments, while collectively promoting a greater role of the multilateral trading system in global governance.

Second, firmly uphold WTO preferential treatment for developing countries.

The special and differential treatment benefiting developing members is the most prominent disagreement between the Global South and developed countries. Developed countries prioritize their interests and attempt to use the organization's rules and mechanisms to maintain and expand their advantages.

Although the Global South constitutes the majority of WTO members, its overall strength is relatively weak and it often lacks effective negotiation capabilities and influence, making it challenging to secure reasonable benefits and development within the WTO.

The Global South must defend the special and differential treatment of developing members, adhere to multilateralism, advocate the restoration of the Appellate Body, protect the legitimate rights of all members, and effectively utilize the WTO's functions of review, oversight and dispute settlement. This will make the WTO a more equitable, reasonable, inclusive and coordinated organization.

The Global South should actively participate in discussions on multilateral negotiations and new issues, such as e-commerce, investment facilitation, the environment and climate change. This involvement should seek to achieve more consensus and agreements within the framework of the WTO while ensuring the openness and eligibility of the most-favored-nation treatment.

Third, proactively pursue initiatives in digital trade and green trade.

Digital trade can reduce costs, improve efficiency, expand volume, promote innovation and increase value. However, it also faces network and personal data security risks arising from cross-border data flows.

Green trade can reduce the adverse environmental impact of trade, enhance trade quality and efficiency, strengthen trade competitiveness and sustainability, promote trade transformation and upgrading, and make public interest. But it is also threatened by climate change, biodiversity loss and environmental pollution.

Therefore, the Global South should advocate the establishment of WTO rules that promote the development of digital trade and green trade, as well as to settle disputes in these areas. While maintaining openness and inclusiveness, efforts should be made to address the security risks and threats posed by these developments.

The global development of digital trade and green trade requires the collaborative efforts of the Global South and developed countries. Taking into full consideration the circumstances and interests of all parties, the Global South should cooperate with developed countries within the framework of the WTO with an open mindset, a spirit of cooperation, and innovative approaches, to jointly steer digital trade and green trade in a more fair and reasonable direction.

The author is deputy director and a researcher at the academic committee of the Chinese Academy of International Trade and Economic Cooperation. The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.

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