The World Trade Organization’s biennial meeting ended in stalemate on Wednesday after U.S. criticism and member country vetoes, raising questions about the body’s ability to govern increasingly disputed global trade. Ministers gathered in Buenos Aires were never expected to agree on major trade reforms, but even relatively minor proposals on e-commerce and fishing subsidy curbs ran aground. “We have not achieved any multilateral outcomes,” European Union Trade Commissioner Cecilia Malmstrom told a news conference. “The sad reality is that we did not even agree to stop subsidizing illegal fishing.”
She said the meeting laid bare the deficiencies of the WTO negotiating system, which requires unanimity among all 164 member countries. She said the United States was partly to blame, but other countries also held up progress. “Procedural excuses and vetoes from one member or another, cynical hostage taking, have led to the sobering result of today,” Malmstrom added. WTO Director-General Roberto Azevedo added that WTO members needed to do some “real soul searching” about the way forward and realize they cannot get everything they want.
Absent any agreements, trade ministers focused on the WTO’s post-conference work programs, such as efforts to improve market efficiency and curb excess industrial capacity, WTO spokesman Ken Rockwell told reporters. Some 70 member countries, including the United States, European Union, Japan and Brazil pledged to forge ahead with an effort to negotiate rules on electronic commerce after a broader deal among the full membership failed. Absent from the group were China, India, Vietnam and Indonesia.
U.S. Trade Representative Robert Lighthizer set an acrimonious tone at the start of the conference with sharp criticisms of the WTO. The 23-year-old trade body requires unanimity among all 164 WTO member countries to reach any agreement. Lighthizer told WTO ministers on Monday that it was impossible to negotiate new rules while many of the current rules were not being followed, and that the WTO was losing its focus and becoming too litigation-focused. Even the perfunctory joint ministerial statement looked in doubt at the conference, known as MC11.
Driven by President Donald Trump’s “America First” strategy and a preference for bilateral deals, the United States had already blocked ambassadors from drafting a ministerial text in Geneva that included references to the centrality of the global trading system and to trade as a driver of development.
USTR spokeswoman Emily Davis denied that the United States was the problem in the lack of negotiated outcomes, saying the Obama administration had raised similar WTO grievances.
“The United States has remained engaged throughout MC11 to achieve progress where possible,” Davis said in an emailed statement, adding that Lighthizer made “honest remarks on issues the United States has been raising for years.” Lighthizer left Buenos Aires for Washington on Tuesday night, missing the final day of the conference. The failure to reach any major deals meant that negotiations on the same topics will continue into 2018, with no deadline and no heavyweight ministerial momentum to get agreement.
But on Tuesday, the European Union and Japan joined the United States in vowing to combat market-distorting policies, such as those pervasive in China that have fuelled excess industrial capacity, including subsidies for state-owned enterprises and technology transfer requirements. An EU source familiar with negotiations over the statement said it was instigated by Japan, partly as a means to coax Washington into working multilaterally to solve such problems rather than resorting to unilateral trade restrictions.