I am very enthusiastic about the future prospects for the multilateral trading system embodied in the World Trade Organization.  The open question is the time frame for getting there. 

In the meantime, while there is much greater uncertainty for trade, the multilateral trading system has not collapsed, nor has it been marginalized.  In fact, despite all the headlines of additional tariffs and the several hundred bilateral and regional trade agreements, 80% of world trade continues to be nondiscriminatory, as provided for in the foundational first principle and requirement of the multilateral trading system. 

It is important to understand both what we have and what is needed going forward.  If you boil the WTO agreements down to their essence, you discover that they are about fairness.  Anyone who produces something that can marketed internationally, as a farmer, worker, or a business, whether that business consists of one person or tens of thousands of workers, will face a more level global playing field because the WTO exists.  If you are an innovator, there is a better chance that your intellectual property will be respected.

The WTO’s rules cover 98% of world trade.  They provide a level of increased predictability, without which investment would not occur.  The system is designed to reward hard work, capital investment and ingenuity.  Market forces are to determine competitive outcomes.  That is the ultimate promise; it is in the interests of all that that promise be made good.

This does not imply that the system cannot be improved.

We live in a different world than the one in which the rules were put into place, whether in 1947 when the multilateral trading system was founded or in 1995 when stewardship of the system was entrusted to the WTO. 

An update of the rules is needed to increase its relevance  —

• To adapt to the world of digital commerce.
• To meet shared environmental objectives
• To assure that small and medium enterprises can participate more fully in trade
• To be clear that women are not disadvantaged.

Two of the most widely supported current near-term objectives of the WTO’s members are: (1) to curb the fisheries subsidies that are laying waste to the oceans’ food resources and depriving coastal fishermen of their livelihoods, and (2) to assure that digital commerce can expand without harmful government interventions.  These initiatives must succeed, and ultimately they will.

The WTO is the product of eight extensive rounds of multilateral trade negotiations that took place over seven decades.  It exists because of leadership of some and cooperation of many.  They shared goals and objectives.  It rests mainly on trust, trust that obligations will be lived up to, that rights will be respected.

These are times of both testing of the bonds that exist and working to expand the areas of agreement.   The negotiating function of the multilateral trading system must be fully restored to what it was during the half century that followed the Second World War.  A fully functional dispute settlement system must be rebuilt, with legitimacy accepted by all, as the system that was provided for in the WTO agreements no fully longer exists.

Fresh evidence as to the current value of the WTO is that 23 countries and customs territories seek to join it, and that all 164 current Members of the WTO seek to improve it.

There is more work to be done to keep the system vibrant.  For world commerce, it would be a gross understatement to say that the current times are merely interesting.  Humanity has done great things when challenged to do so.  This is one of those times of both being tested and being presented with enormous opportunities for improved international trade relations.

The chief burden placed on international trade does not consist of visible tariffs.  Economists estimate that moving a product from factory or farm across an international border to customers abroad faces obstacles that are on average the equivalent of a 270% tariff.  That must be changed.

It will take a more concerted effort by all to shorten the time to success.  That is where businesses and other private stakeholders can make a positive difference.  More intensive  engagement is necessary to ensure that the benefits of the multilateral trading system continue and are increased. That which exists today that is good can no longer be taken for granted, and that which is not good can no longer be tolerated.  What can be achieved is in no small part your hands.