4/ DDG González: “A well-functioning global trading system is not a choice, it’s a necessity”
4 OCTOBER 2022
In a keynote address delivered to the Third Australia-Europe Economic Relations Dialogue on 4 October, Deputy Director-General Anabel González highlighted the need to equip the global trading system for a new era of overlapping and compounding crises in the economic, environmental, public health and global security spheres. “At a time when many forces are pulling them apart, WTO members have an interest in coming together to restore confidence in the global trading system and its ability to make people’s lives better,” she said.
DDG González said that the global shocks of the last few years have exposed the vulnerability of the business models that underpin many global production networks. “A reconfiguration of supply chains to achieve a better balance between efficiency and risk in the global economy seems not only likely but, given the circumstances, also justified to some extent,” she said.
“But the road from dependence to diversification may be risky,” DDG González noted. She highlighted the risk that trade policies, if not well targeted and carefully designed, will discourage innovation and impose high costs on consumers and companies without necessarily improving security of supply. “The path to greater resilience lies not in retreating from trade, but in diversifying it,” she said.
DDG González said that “the global trading system must adapt to today’s vastly more complex trade policy landscape”. She emphasized the need to create new trade opportunities wherever possible, especially for those who remain on the margins of the global economy, including small businesses, women and the least developed countries.
“This requires unblocking longstanding areas of negotiation like agriculture, while moving ahead in areas such as digital and services trade, which are powerful instruments to bring new players into the global economy,” she said.
DDG González noted that subsidies in agriculture, industry and services have become a main driver of tensions among trading partners and require the attention of WTO members. She called for efforts to improve transparency and policy dialogue on subsidies “to help WTO members develop a shared factual basis and common understanding of the issues at play”.
She noted that “the impacts of climate change are visible everywhere and are only going to get worse unless we act decisively”, adding that “concerted trade action is critically important to support the transition to net-zero, not least by bringing climate-friendly technologies to where they are needed while creating the openness, stability and predictability needed to mobilize green investment at scale”.
DDG González said the process of WTO reform launched by ministers at the WTO’s 12th Ministerial Conference last June can help build a global trading system that can respond to the challenges of the 21st century.
“WTO reform cannot come soon enough, and in fact some of it is already happening, for example in negotiations,” she said, adding that “our successful 12th Ministerial Conference is living proof that WTO members value the global trading system and are capable of delivering meaningful multilateral outcomes that strengthen the system even in the most difficult geopolitical conditions”.
Source: wto.org
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