Ngozi Okonjo-Iweala will find the WTO a challenge – but the only way is up

With Donald Trump’s departure, it was only a matter of time before Ngozi Okonjo-Iweala was appointed to run the World Trade Organization. Joe Biden could have maintained Washington’s objection to the former Nigerian finance minister becoming the first woman and the first African to run the Geneva-based body but has sensibly decided not to.

Like the football manager taking over a team struggling at the bottom of the table, Okonjo-Iweala is in the happy position of taking over at the WTO when the only way is up. Of all the big multilateral economic organisations, the WTO is the toughest gig: trade is a hugely contentious issue and yet decisions in Geneva are made by consensus. The old days when trade deals were a stitch up between the United States and the Europeans are long gone. There has not been a successfully completed round of trade liberalisation talks since 1993. The WTO’s ability to police global trade is in doubt because the US has blocked the appointment of new judges to its appeals body.

No question, Okonjo-Iweala is going to have her work cut out. She has no real background in trade, although that may prove to be less of a handicap than some of her critics imagine. The last two WTO director-generals – Roberto Azevêdo and Pascal Lamy – struggled to make much progress with trade liberalisation despite knowing the subject inside out. Okonjo-Iweala believes a politician rather than another technocrat has a better chance of sorting out the WTO’s problems – and she is right because each of the three big challenges she faces has a political dimension.

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The first is to accept that the Americans (backed privately by a number of other countries) have a point when they say judges on the appeals body are there to interpret trade law, not make it. The US will not fully engage with the WTO – under any president – until that happens.

The second is to repair the strained relationship between the three main players in global trade: the US, China and the EU. That is no easy task given a breakdown in trust but ought to be helped by a fading of protectionist pressures as the global economy recovers from the pandemic.

Finally, it will be 20 years in November since the WTO launched the now moribund Doha round of trade talks in which the needs of developing countries were supposed to be central. A properly functioning global trading system would make the most vulnerable nations more resilient and reduce the gap between rich and poor countries. A test of Okonjo-Iweala’s leadership will be whether she can deliver on this unfinished business.



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