US threat to WTO won't get it anywhere

The US leader signed a memorandum on July 26, directing the Office of the United States Trade Representative to stop treating "advanced economies" such as China as developing countries according to the World Trade Organization's rules, and urging the WTO to change its definition for developing country within 90 days. But since major reforms to the WTO require consensus (in effect unanimity) among all members, the world trade body cannot change the definition, even if it wants to.

The WTO is the most important global trade body comprising 164 members. And the US has the same rights within the WTO as the other 163 members. The US can forward any proposal to the General Council of the WTO for review and consultation but has no right to force the WTO to make a decision in its favor. Therefore, the 90-day ultimatum will earn the US only the scorn of the WTO and its members.

The memorandum has not only challenged the WTO's authority, but also caused confusion over the meaning of developing economy. The US leader also has questioned the status of China, Qatar, Singapore, and other developing economies, without saying what a clear definition of a developing economy should be.