knows— maybe the Trump-led U. S. or the next administration might even agree to some objective limits on how far and fast tariffs can go up, even if not down.
Additionally, a Trump-Modi Round could examine and update other existing WTO agreements, many of which deal with non-tariff barriers and trade in services and may be generally sound in their current form. Non-market behaviors that have escaped effective disciplines should be a priority in renegotiations. Finally, new areas of trade should be on the table. This already seems like a given, as there have been discussions in Geneva for years about updating the rules, particularly in areas such as digital trade. For example, a Trump-Modi Round should provide a clear pathway to conclude negotiations on the Joint Statement Initiative on Electronic Commerce, building on innovations in digital trade agreements that have been negotiated outside the WTO. In May, WTO Director General Okonjo-Iweala emphasized that existing WTO agreements should be kept dynamic and relevant, and that the WTO should be responsive to future developments.
In the end, current WTO members would have a choice between staying in the current
WTO or leaving it for a newly reformed and reoriented WTO 2.0. This is hardly utopia. The purist perspective that favors a world without tariffs in which all benefit from the efficiencies of unfettered comparative advantage is much closer to this unattainable goal. However, it doesn’ t have to be dystopia either. Over time, countries might find themselves gravitating back towards tariff liberalization, especially if tariff increases don’ t play out as advertised, and with stronger assurances that it can be truly reciprocal.
Some may see this as giving in or giving up. However, I believe any fervent hope that the U. S., or others without the U. S., might seriously turn back to policies that reflect a period in which the WTO was highly relevant is a pipedream. That will not happen. Instead, facing up to reality before the WTO ends up definitively in the dump heap of history, could provide the spark of new life the aging and teetering multilateral system needs. This won’ t happen through baby steps of incremental or modest reforms, whether through voting protocols or committee procedures. Going big is the only path to a future for the organization and multilateral trade.
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34 Bold ideas to power progress