It is my great pleasure to welcome you on behalf of WTO Senior Management to this training on WTO Accessions Rules.
As you know, the World Trade Organization has 164 members. The WTO covers some 98% of world trade. No country has ever withdrawn from the WTO and 22 countries seek to accede -- to join the WTO. Those that are already in the WTO and those that want to be in it largely have the same reason for being so. They each want to better the economic opportunities for their businesses which translate into a better life with a higher standard of living for their people.
The world economy has grown dramatically since the first multilateral trade rules were put into place under the GATT in 1947. Measured by per capita GDP, global economic well-being is 5X what it was in 1947 and it has doubled since the WTO was founded as the successor to the GATT in 1995. By contrast, before the WTO existed, it took 70 years for global per capita GDP to double.
The origins of the GATT stem from the recovery, reconstruction and development effort to deal with the ruins of the Second World War. The multilateral trade regime was part of the architecture, along with the World Bank, the IMF and bilateral aid, to underwrite the new and very fragile peace. Some joined the multilateral trading system, and some did not. The Soviet Union chose to observe rather than join. That failure was just one factor in the complex set of reasons there is no Soviet Union today.
The World Trade Organization differs from other international organizations in that it is the custodian of numerous multilateral agreements with obligations that are enforceable. So, it is not enough for your government to declare its willingness to join the WTO and to assume the modest financial obligations membership entails. Substantive and procedural obligations are undertaken for their own sake and for the reciprocity gained from other Members.
The fundamental rules of the multilateral trading system are simple in concept. For trade to move across borders, (1) the barriers must be low enough, lower in almost every case had every country and ministry been free to set whatever import restrictions, normally tariffs, that they wanted to, and (2) Members are not free to discriminate against imports on the basis of the country where they come from. With that one sentence you have the first two core obligations of the WTO -- binding levels of protection and non-discrimination.
Add to this a third basic obligation at the core of the multilateral trading system rules -- no WTO member country can discriminate against the goods of another member country through domestic regulation once a good has entered the country. There are some exceptions, for example, where there is a regional free trade agreement. But the foundation upon which each regional agreement rests is the basic set of WTO commitments.
A key purpose of knowing the basics is not only for the negotiations that you will be undertaking in Geneva with other delegations, which you probably already know but because you have to explain the rules at home to other ministries, to legislators, to businesses and to the public.
You will get more familiar with the system while here for these two weeks. You will learn that while tariffs may be low, and there cannot be discrimination in the application of trade measures, that product standards, for example, if not regulated, could strangle trade, if not kill it altogether. What if a country decides to set a food or other product standard that is simply protectionist? That happens. There are processes and rules to persuade it not to do so. Members notify their technical standards to a WTO committee in draft and receive comments from other members. Members would rather hear about problems before the standard is put into place rather than having to revise it later.
You will be asked at home whether, if a domestic industry is harmed by imports, there are trade remedies, and about the rules on how to apply them. And if other countries that are export markets for your product wish to apply these remedies against your country’s exports unfairly, you can assess their legitimacy under the rules. When asked, you will have a ready answer: there are the means to deal with that as well.
Article XII of the Marrakesh Agreement that governs WTO accession negotiations does not dictate all of the terms on which applicants may be invited to accede, but simply provides that a State or separate customs territory may accede “on terms to be agreed between it and the WTO”. The reason for this lack of specificity is that the drafters saw the need to provide flexibility to ensure that the terms of accession are not defined in advance. This preserves the right of Members to adapt the terms to the circumstances of each case.
Some accessions are more complex than others. For China, by far the largest country to accede to the WTO, there were thousands of regulations and statutes that needed to be amended. It was an immense task. For a few acceding countries, they were already in close economic relationships with countries that were already WTO members, so they knew many of the rules and lived by them already.
Thirty-six countries have joined the WTO since it was founded 24 years ago. Several of their chief negotiators for accession have talked with you already. Last Thursday, the Inaugural Session of the Accession Negotiators' Network took place in the meeting with you. I was very happy to see how the original idea behind the establishment of this Network had become reality. Dialogue and experience-sharing are powerful tools for advancing accession negotiations. The former accessions negotiators’ enthusiasm and their stories are marvellous.
I listened with interest. Clearly for many, maybe for all of them, working for their countries’ WTO accession was a high point of their professional careers. Why? Because they got to know their economies intimately, including what its needs were. They got to know what other governments wanted of them. They played one of the most important roles for their countries that few have the opportunity to experience.
When you have gone through this training and then the accession process you will know more about the international trading system than any trade minister of any country who has not gone through this WTO accession process. You have a phenomenal and rare opportunity and learning experience. You will need to negotiate both at home among businesses and ministries, and turn around and negotiate with foreign countries, because all current members can have a say as to whether you join the WTO. You will become very good negotiators. If you already are good, you will get even better. You will always have a lot of help if you need it. The group of prior accessions negotiators will be ready to assist, as will the WTO secretariat which should be your first stop for getting assistance. And once accession is done, and your ministers sign the Protocol of Accession, you will have pride in the fact of having done more for your country and its people than most ever have the opportunity to do.
And then comes the implementing phase. Many of you will be called upon at a later stage in your careers to assist ministries and even local governments with compliance with your country’s new obligations while making sure that you hold other WTO countries accountable.
When I was a very young lawyer, I was given the responsibility for the trade law portfolio at the U.S. Treasury, the U.S. equivalent of a finance ministry. It was my second year in the U.S. government. My law school did not have a course on the international trade rules. I knew very little about the rules of the trading system. As a college student, I had only the basic economics course. It was not enough. I wanted to understand the theoretical basis for why trade took place, and I did not know anything about how other countries expected the U.S. to act. So, I enrolled in night school at George Washington University. I was fortunate that the professors were excellent. In the GATT course, one of them was General Counsel of the World Bank (Lester Nurick) and the other was a very distinguished senior international trade lawyer (Walter Sterling Surrey).
During the next year when I got into more challenging problems, I hired the world’s best-known GATT expert, Professor John Jackson, as a consultant. He was one of the key individuals who envisaged having a WTO. I became the Office Director at the Treasury for the then current round of multilateral trade negotiations (the Tokyo Round). Three years later John Jackson invited me to be his Deputy General Counsel at the Office of the Special Representative for Trade Negotiations in the Executive Office of the U.S. President. With the Congress, we drafted the basic trade legislation that allowed the US to participate in trade negotiations as a delegation from the U.S. Congress. I got to be lead negotiator on several issues, one was specialty steel. I became Jackson’s successor as General Counsel. And when a new President came into office, I moved up to be a senior negotiator for the US government as Deputy Trade Representative.
But it all started with a basic course in what the international trading rules were all about -- not probably as comprehensive as this one, and not with hands-on experience of the experts in the WTO Secretariat, but it was a beginning.
Here you will be building your own valuable network. With those in the training with you, with members of the Secretariat, and perhaps with some of the guest lecturers who are veterans of the process.
You will learn that every accession is a different to a degree, because the countries you are from have differing economies and WTO members may have differing commercial interests regarding your accession. But there is enough in common in terms of process and obligations that the fundamentals you will be introduced to here will be very valuable to you.
Later this week, you will interact with two more experienced negotiators from the EU and the U.S. – the two WTO Members most involved in the details of the accessions process. Ultimately, the goal of this 2-week training programme is for you, as negotiators, to have an opportunity to hear different perspectives and ask questions in different formats and in a non-negotiating setting.
With these thoughts and my best wishes for the remainder of this Seminar, I conclude my brief remarks and look forward to hearing from you your thoughts on week one and your general impressions so far.Thank you.