Future of WTO

Future of WTO

© Sabari Ganesh; “All Rights Reserved” 
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            The World Trade Organisation (WTO) was established on January 1, 1995 with the sole prime objective of promoting free and fair trade among nations of the world. The multilateral trade discussions among member nations play a pivotal role in advancing towards a better free trade regime. The success of these trade talks therefore is a critical element of progress. Over the past twenty years, and a series of multilateral trade talks; free trade in totality is still a dream.

            The basic idea of free trade among nations is to provide a level playing ground for companies to compete. The objective is the betterment and enrichment of human life irrespective of any distinction based on geography, race or sect etc. The competition is intended to be based on competencies and merit alone. A level playing ground shall be a reality only when it is ensured that competition is ethical and among equals. However, the members of WTO stand segregated based on their economic health; as developed, developing and backward nations.

            The most powerful logic that blocks WTO from achieving the free trade regime in totality is the innate need and urge of its member nations to protect their domestic industry. The propellant of such an idea is the negative impact of free trade on the weaker sections of the participants. The focus and efforts of WTO has so long fallen short to escalate and strengthen its members as equals on every possible parameter. The intent of the member nations too is selfish to the extent of benefitting from the free trade regime without yielding on their present protectionist measures.

            The prime contention among the developed and developing nations are on three aspects - Agriculture, Services and Manufacturing. The sophisticated technology of the developed countries is a threat to the developing countries that would eventually annihilate their domestic industries. The developing nations pose a serious threat to the employment scenario of its developed counterparts with its comparatively low cost technically skilled manpower; which over a period of time would have a devastating effect on the economy of the developed countries. The subsidies granted by the governments of the developed nations challenges the level playing field; so as the protectionist measures and customs procedures of the developing nations.

            Also, the WTO is witnessing a major change in its composition mix since its inception. The members belonging to the category of developing nations are on the rise; hence their voice and demand. The dominance of the developed countries; especially that of the US and EU is challenged at the discussion table of trade talks. The present scenario witnessing the dwindling economies of the developed countries and the relatively stable economies of the developing countries has enabled the WTO operate more as an independent body than a puppet of the US and EU.

            Free trade shall become a practical reality when the competing grounds become flat and even for all the member nations. Twenty years for an organisation with such a massive objective is infancy. Levelling the competing grounds needs strategic intent and segmented focus. The blurring of consensus of the trade talks may be attributed to the vastness of the scope and spread of the focus taken up for discussions; given the economic diversity of the member nations and their protectionist attitude.

            The rise of India and China as a prominent representative of the developing countries is a healthy sign of balancing the WTO weigh scale. As the popular analogy dictates that water finds its level, effectively loses its crest and trough at the same instance. The stalemate of the multilateral trade talks is a quite anticipated incident; thankfully has channelised the trading partners to a series of multiple bilateral and regional Free Trade Agreements (FTA). These FTAs also come under the legal auspices of the WTO effectively minimising the contest on the success and relevance of WTO owing to the stalemate of trade talks.

            The best option for the WTO in the present scenario could be to ensure focused and encapsulated discussions at the ministerial meetings on select agenda; and encourage the proliferation of FTAs; as it is a positive sign of self-imposed consensus among member nations. The proliferation of FTAs, when plateaus would lead to the natural unification of the agreements on a vast scale with considerable ease and finesse. The effectiveness of WTO in its administration, surveillance and enforcement of the FTAs is a strategically critical move towards achieving its ultimate objective of a world with complete free trade in all aspects.

            Also, from the perspective of individual nations, the FTAs play a vital role in giving a breather to strengthen their economies and decide upon competencies. This again is a prerequisite to withstand the grandeur of complete and unified free trade among every member nation. A well thought-out strategic long term focus and dynamism in implementation is the need of the hour in the WTO. In the present scenario, dispute settlement is a key area which needs a much closer attention of the WTO's governing body than a Free Trade in totality.

            The focus of WTO in modalities to ensure proper representation of member nations during discussions on trade talks and policy decisions, transfer of information, knowledge based assistance to infrastructure and technological up-gradation; that minimises the burden of the Dispute Settlement Board (DSB) is worth to be considered success. For instance, in the Indian domestic scenario, strategically planned enormous investments in cold chains is a critical element of Amul's success? and it took its time!

            The WTO is a very unique and splendid organisation that aims to unify every member as equal entities on a level ground with free and fair trade ensuring progress and development. Twenty years is infancy given the skyscraper objective. The present stumbling stones indicate the need to revise the point and increase the length, of focus. The ultimate success of WTO shall be characterised by every member nation becoming highly specialised in select areas of trade - be it products or services; with unimaginable level of precision and core-competency thereby enhancing the life of every individual in a positive manner.