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WTO Director-General candidates debate at IMD

January 31, 2013

Five of the nine candidates to become the next Director-General of the World Trade Organization (WTO) outlined their visions for global trade during a debate at IMD on January 30.

The debate, organized by The Evian Group@IMD, focused on how to rekindle the interest of the private sector in the WTO.

Debate host Carlos Braga, Director of The Evian Group@IMD and Professor of International Political Economy at IMD, said many CEOs are frustrated with the WTO. This reflects the slow pace of multilateral trade talks, in particular the stalled Doha Round, and also the perception that WTO rules do not address the most relevant trade issues of today—such as the operations of global supply chains and the proliferation of preferential trade agreements. 

Despite these challenges, a record nine candidates are bidding to replace Pascal Lamy, the current Director-General, whose term expires on August 31. The new WTO leader is due to be chosen by the end of May, although this process has historically not been smooth, as Professor Braga pointed out in a recent comment.

Although the five candidates agreed that the WTO and the private sector need to engage more closely and regularly with each other, they emphasized different aspects of this relationship in their remarks.

Tim Groser, New Zealand's Minister of Trade, said the private sector will show much more interest in the WTO when it sees evidence of real momentum in multilateral trade talks.

"The problem lies with us. We have to develop momentum, and then business will come. And we will need business support to get any agreement through," said Groser, who is also his country's Minister for Climate Change Issues and Associate Minister for Foreign Affairs.

Anabel Gonzalez, the Minister of Foreign Trade of Costa Rica, said reaching a trade facilitation agreement at the WTO Ministerial Conference in Bali in December 2013 would help to rekindle private sector interest. She added that the WTO should discuss issues of greater relevance to the private sector, such as global value chains.

"The private sector has been driven away by long and less relevant negotiations. We need to see how talks can deliver quicker results," said Gonzalez, who previously was Director of the WTO's Agriculture Division.

Mari Elka Pangestu, a former Indonesian Trade Minister who is now Minister of Tourism and Creative Economy, agreed that a trade facilitation deal could ease some of the private sector's frustration with the WTO. Like several other candidates, she supported the idea of a business advisory panel to discuss trade issues with the WTO.

"Business wants to see some of the 21st century agenda that affects the private sector being addressed. So there needs to be dialogue," she said.

Amina Mohamed, Kenya's former WTO Ambassador, said the WTO has not lost the private sector, despite the current frustration.

"The private sector and the WTO are partners, and a divorce couldn't happen even if we tried. Trade is an engine for growth, and business is interested in predictability, stability and open markets. And that can only be provided at a multilateral level through the WTO," she said.

Alan Kyerematen, a former Minister of Trade and Industry from Ghana, said the WTO needs to reach out more actively to business – including via a global trade summit. But, echoing some of the other candidates, he said the private sector does not only include large multinational companies.

"The private sector includes small and medium-sized enterprises too. We need to bring the underprivileged parts of the private sector into the global value chain," he said.

Alejandro Jara, a current WTO Deputy Director-General, drew three lessons from the experience of WTO-private sector relations during the last eight years in which he occupied this position.

First, the private sector is always interested and active in the final stages of trade negotiations, "but they won't waste time coming here if an agreement is not likely." Second, the WTO can do better at communicating the possible impact of agreements and rules on business. Third, private sector associations should consider increasing their presence in Geneva to gain a better understanding of what's going on at the WTO.

The other four candidates are Roberto Carvalho de Azevedo, Brazil's current ambassador to the WTO; Herminio Blanco, Mexico's former Minister of Trade and Industry who was his country's chief negotiator for the North American Free Trade Agreement (NAFTA); South Korea's Trade Minister, Taeho Bark; and Ahmad Thougan Hindawi, a former Industry and Trade Minister of Jordan. All nine candidates made presentations to the WTO General Council between January 29 and this morning.

Professor Braga closed the debate by saying multilateral trade rules are central to global economic integration and sustainable development. But he also highlighted the challenges that the next Director-General will face in realizing his or her goals.

"There is an embarrassment of riches in terms of the number of qualified candidates applying for the role, and all of them have a vision for the WTO. But vision without implementation is hallucination, and we hope the next DG will be able to transform many of the ideas debated here today into reality," he said.

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