Time to Apply the WTO’s Enforcement Power
By Ben Conner, USW Assistant Director of Policy
The power of the World Trade Organization (WTO) may seem somewhat dim these days. The Doha Round negotiations have been stalled for years and there are many flagrant violations of WTO rules that have been documented by groups like USW. Free trade agreements (FTAs) proliferate, while many see the multilateral system represented by the WTO as ineffective at best.
However, we should not overlook the strong foundations that the WTO creates for global trade —foundations that many take for granted today. In particular, the WTO Agriculture, Subsidies and SPS Agreements lay the groundwork for clear, consistent and appropriate state involvement in agricultural trade and production. FTAs go beyond the WTO for particular trade relationships, but the WTO rules undergird FTA rules. USW is encouraging use of this rules-based enforcement system to ensure countries meet their commitments. It is an under-used tool for advancing free trade through negotiations at the WTO and other settings, and pushing for enforcement when other avenues have failed.
The WTO agreements — along with advances in technology, peace and security in international waters, and flourishing economies across the world — helped spark a golden age of food and agricultural trade. While the world’s population has grown by 30 percent since the 1995 creation of the WTO, trade in agriculture is over 300 percent of its 1995 level. Today, there is a dizzying array of food products available around the world — an abundance unheard of mere generations ago.
Specialization and trade allow Japanese bakers to use flour milled from U.S. SW wheat to bake exquisite cakes, while Italian millers use our durum and hard red spring to create the crucial ingredients for some of the best pasta products in the world. In return, U.S. farmers can raise a glass of sake or chianti to celebrate the exchange. While it is a stretch to say that this would not be possible without the WTO, it is almost certainly the case that the scale and opportunity available to producers, businesses and consumers around the world would be vastly diminished.
Of course, not everyone can enjoy unhampered access to the world’s bounty. As most who engage in international trade understand, countries do not always act in a manner that is “clear, consistent and appropriate,” and often violate WTO rules in ways that have been both bizarre and blatant.
This all underscores the need for active enforcement of WTO commitments. If there is no fear of retaliation sanctioned by the WTO, countries will ignore the strong rules of the WTO agreements. If countries respect their agreements, it will result in a more conducive trade and regulatory environment for food and agriculture.
With very few exceptions, countries reform trade-distorting policies that are successfully challenged at the WTO. So for those who want a better global trading system, don’t scrap the WTO — we say use it more aggressively.
