TWN Info Service on WTO and Trade Issues
9 February 2021
Third World Network
www.twn.my

GC chair to finalize process on appointment of Okonjo-Iweala as DG
Published in SUNS #9281 dated 9 February 2021

Geneva, 8 Feb (D. Ravi Kanth) – The chair of the WTO General Council (GC) on 8 February said that he will hold consultations with members to finalize the date for convening a special General Council meeting ostensibly for appointing Ms Ngozi Okonjo-Iweala from Nigeria as the new director-general of the 164-member inter- governmental trade body.

On 5 February, the Biden administration endorsed Ms Okonjo-Iweala as its choice to lead the WTO.

It reversed the previous Trump administration’s decision to support the Korean trade minister Ms Yoo Myung- hee even though she failed to secure maximum support from WTO members throughout the DG selection process.

In an urgent email sent to members on 8 February, the GC chair, Ambassador David Walker from New Zealand, said “in view of the recent developments concerning the appointment of the next WTO Director-General, I will be urgently consulting with Members in order to take forward the process leading to a formal Decision on that appointment by the General Council, including the date of the Special General Council meeting.”

“I will keep delegations duly informed,” the GC chair said in his email to members.

Ambassador Walker could convene a special GC meeting either this week or in the week beginning on 15 February to enable Ms Okonjo-Iweala to start her work soon, an envoy said.

In all probability, the first woman and the first African to hold the post of WTO DG could assume office either on 1 March or on 1 April depending upon her schedule and her settling in Geneva for the next four years, the envoy said.

Besides, Ms Okonjo-Iweala has to find a new team of deputy directors-general as all the four existing ones, including the Trump administration’s nominee Mr Alan Wolff, will have to step down within a month after she takes office, said another person, who asked not to be quoted.

“I look forward to finalizing the process of @WTO DG,” Ms Okonjo-Iweala tweeted on Friday.

“Grateful for the expression of support from the US today for DG @WTO. Congratulations to Madam Yoo of Rep. Korea for a hard fought campaign.”

South Korea’s trade minister Ms Yoo withdrew from the DG race on 5 February to clear the path for Ms Okonjo- Iweala’s appointment, after a telephonic conversation between South Korea’s President Moon Jae-in and the US President Joe Biden.

“Considering various factors, including the need to revitalize the role of the WTO, Yoo has decided to renounce her [candidature],” South Korea’s Ministry of Trade, Industry, and Energy said in a statement, according to a Yonhap News Agency report.

US ENDS OPPOSITION TO OKONJO-IWELA

By the afternoon of 5 February, the Office of the US Trade Representative (USTR) issued a statement of endorsement of Ms Okonjo-Iweala as the WTO’s next director-general.

“The Biden-Harris Administration is pleased to express its strong support for the candidacy of Dr. Ngozi Okonjo-Iweala as the next Director General of the WTO,” the USTR stated.

“Dr. Okonjo-Iweala brings a wealth of knowledge in economics and international diplomacy from her 25 years with the World Bank and two terms as Nigerian Finance Minister. She is widely respected for her effective leadership and has proven experience managing a large international organization with a diverse membership.”

“The United States stands ready to engage in the next phase of the WTO process for reaching a consensus decision on the WTO Director General,” according to the USTR.

“The Biden administration looks forward to working with a new WTO Director General to find paths forward to achieve necessary substantive procedural reform of the WTO.”

The USTR said “the Biden-Harris Administration also congratulates Minister Yoo Myung-hee on her strong campaign for this position. She is a trailblazer as the Republic of Korea’s first female trade minister and the first candidate from Korea to advance this far in the Director General selection process.”

“The United States respects her decision to withdraw her candidacy from the Director General race to help facilitate a consensus decision at the WTO.”

In the normal course, Ms Yoo would have withdrawn from the WTO DG race in the week of 7 December last year.

Apparently, she held a one-on-one meeting that week with the former US Trade Representative Ambassador Robert Lighthizer to inform about her decision to withdraw from the race.

However, Ambassador Lighthizer insisted that Ms Yoo remain in the race, said people familiar with the development.

South Korea is not the country that has blocked Ms Okonjo-Iweala’s appointment, the person said.

“SYSTEMIC CRISES” AT THE WTO

That Ms Okonjo-Iweala faces a Herculean task to address the systemic crises at the trade body is an under-statement, said another envoy who asked not to be quoted.

Amidst the growing protectionist narratives across all countries, including the United States trade policy of “Buy American” and manufacture everything domestically and the European Union’s export restrictions on the flow of vaccines in the face of the COVID-19 pandemic, attempts to force the same old tariff-liberalization policies “in the garb” of addressing the pandemic will not work, the envoy said.

“Globally, there is a backlash in country after country against the trade liberalization policies and the time has come for a rupture with these trade policies that were pursued over the past 25 years,” the envoy suggested.

It would be simply “delusional” to expect that the new DG could bring any change for addressing the myriad of challenges, the envoy said.

US PRIORITIES AT THE WTO

Even before she begins her term of office at the Centre William Rappard that houses the WTO, key US Congressional lawmakers stressed that they expect the new Director-General to help bring about reform of the WTO that Washington has been seeking.

“The World Trade Organization is a bedrock of US trade policy and is in dire need of a strong leader to bring about necessary and overdue reforms that have been sought by the United States for years,” the US House Ways and Means Committee Chairman Richard Neal said.

Mr Neal urged the Administration to work with the new DG “to meaningfully address longstanding issues, including those related to the dispute settlement system, transparency, notification obligations, subsidy disciplines and special and differential treatment.”

In the face of US pressure on the new DG even before she steps into office, the developing countries are expected to face serious challenges in advancing their “inclusive and developmental” agenda of reforms, the restoration of the Appellate Body without incurring any payment, the TRIPS waiver for combating the COVID-19 pandemic, and securing a permanent solution for public stockholding programs for food security among others, said people familiar with the development.