Project Syndicate: The WTO Reborn?

The World Trade Organization, a multilateral trade group with 164 members, has been marginalized in recent years due to increasing preference for bilateral and regional deals, explains Arvind Subramanian, chief economic adviser to the government of India in an essay for Project Syndicate. He points to three developments that could prompt the world to reconsider multilateralism and revive the WTO. First, alternative regional and bilateral trade deals could flail as is the case with European integration. “After Brexit, the WTO will probably become an important forum for Britain’s trade relations with the world,” he writes. Second, voters reject what he calls hyper-globalization, which “goes beyond creating open markets for goods and services to include increased immigration (in the US and Europe), harmonizing regulations (the ambition of the TPP and the TTIP), and intrusive adjudication of domestic policies.” Finally, new protectionist stances could prompt China, India, Australia and other mid-sized economies to pursue WTO adjudication. “The WTO could, therefore, become the place where US trade policies are scrutinized and kept in check,” Subramanian notes. If the members review policies and can reach agreement on opposing protectionism, the WTO’s large membership could become a strength rather than impediment. – YaleGlobal