{"id":441,"date":"2007-12-03T21:03:15","date_gmt":"2007-12-03T21:03:15","guid":{"rendered":"http:\/\/astraea.net\/blog\/?p=441"},"modified":"2008-07-06T21:19:21","modified_gmt":"2008-07-06T21:19:21","slug":"the-warwick-commission-report-on-world-trade","status":"publish","type":"post","link":"https:\/\/www.astraea.net\/blog\/the-warwick-commission-report-on-world-trade\/","title":{"rendered":"The Warwick Commission report on world trade"},"content":{"rendered":"

The Warwick Commission report<\/a> on the world trade system …<\/p>\n

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Experts\u00a0Say Consensus Should No Longer Be Deal Breaker\u00a0in World Trade<\/p>\n

The Warwick Commission, a panel of leading specialists on world trade is this week publishing the results of its 10 month study of the state of the world trade system. They are concerned about what they see as a dwindling commitment to multilateralism in global commerce and critical of national political leaders\u2019 reliance on \u201cthe politics of blame and responsibility avoidance\u201d in trade talks.\u00a0 They call for an end to the reliance on consensus decision-making in future negotiations; a bigger role for the World Trade Organization in the delivery of Aid for Trade to developing countries; escalating financial compensation as a means to resolve some trade disputes and a high level \u2018reflection exercise\u2019 on the future of the trade system by the members of the WTO.<\/p>\n

The Warwick Commission is chaired by the Honourable Pierre S. Pettigrew, PC who has held office in Canada as both Minister for Trade and Foreign Affairs, and is now Executive Advisor, International, at Deloitte.\u00a0 The Director of the Commission is Professor Richard Higgott of Warwick\u2019s Centre for the Study of Globalisation and Regionalisation.\u00a0 The Commission\u2019s report is entitled The Multilateral Trade Regime: Which Way Forward? \u00a0It will be launched at the WTO headquarters in Geneva at 11am on Thursday 6th December 2007.<\/p>\n

One of the key recommendations of the Warwick Commission relates to the WTO\u2019s long tradition of relying on consensus in decision-making.\u00a0 The Commission notes that \u201cconsensus-based decision-making can be cumbersome if the need for a consensus enables a single player or a few players to block outcomes and stifle progress.\u201d<\/p>\n

\u201cPreventing a decision from being taken may be entirely legitimate where vital interests are at stake, the more so if there is a shared perception among a significant group of countries that a particular outcome is undesirable.\u00a0 But equally, blocking may lack legitimacy where its aim is more to prevent others from moving an agenda forward than it is about avoiding a policy outcome perceived as harmful by those exercising a veto.\u00a0 In the history of GATT\/WTO, there have undoubtedly been occasions where some parties have seen the action of others as less than fully legitimate in this regard.\u201d<\/p>\n

The Warwick Commission therefore recommends that serious consideration be given to what has come to be known as \u2018critical mass\u2019 decision-making.\u00a0 This \u2018variable geometry\u2019 solution would bring together a critical mass of countries with clear direct interests in the particular trade issue to be discussed.\u00a0 Again, there would be no vote but consensus on the issue would be reached by that critical mass of countries avoiding tactical vetoes from nations with little or no real interest in the issue at hand.
\nHowever the Warwick Commission also recommends that in these circumstances all nations that did not form part of the initial critical mass agreement must have the unchallengeable and unqualified right to join the accord at any time in the future on terms no more excessive than those accepted by signatories to the original critical mass accord.\u00a0 The Commission notes that there are precedents for critical mass arrangements in the basic telecommunications, financial services and Information Technology Agreements of the second half of the 1990s.<\/p>\n

The second significant recommendation of the Warwick Commission is that the option of financial compensation should be added to the list of possible remedies available to the WTO as a means of penalising non-complying states. From the perspective of a system one of the goals of which is to liberalise trade, the imposition of trade sanctions, or restrictions, is both counter intuitive and counterproductive.\u00a0 In most cases, sanctions increase the cost of imports and harm weaker nations that have won their case.\u00a0 Thus, the Commission proposes that WTO Members consider introducing an obligation to provide cash compensation to aggrieved parties where compliance or trade-related compensation is not forthcoming.<\/p>\n

This approach is not only less trade-distorting, it would also offer developing countries the possibility of neutralising what is otherwise a major asymmetry in the WTO\u2019s dispute settlement system.\u00a0 Indeed, in certain circumstances the Commission argues it would be appropriate to provide for an escalating amount of compensation until an offending party complies or compensates through trade measures.<\/p>\n

The Commission argues that the WTO must deliver more for its weaker members and identifies as a \u201ckey challenge\u201d the reconciliation of trade and development under conditions of globalisation.\u00a0 The Commission\u2019s Report makes it clear that the multilateral trading system must offer meaningful support to developing countries so that they can take advantage of the trade opportunities open to them in an increasingly global world.\u00a0 The Commission concentrates on the importance of the Aid for Trade initiative and the Special and Differential Treatment arrangements available to WTO Members and recommends that the WTO should have a clearly defined role in the implementation of the Aid for Trade initiative.\u00a0 It also recommends that Special and Differential Treatment arrangements should, in future, recognise the different development needs of individual Members rather than the perceptions of developed countries donors of what is best for weaker Members.<\/p>\n

The Commission is also critical of national political leaders\u2019 failures to defend the multilateral trading system.\u00a0 Leaders, the Commission says, \u201chave often failed to explain adequately to the public what is at stake.\u00a0 Instead they have preferred silence, or worse, the politics of blame and responsibility avoidance.\u00a0 Governments must look beyond the electoral cycle and confront more directly the vested interests that benefit from protection and the inefficiency it breeds.\u201d\u00a0 The Commission calls for the membership of the WTO to engage in a reflection exercise that will consider the challenges and opportunities facing the multilateral trading system and draw up a plan of action to address them.<\/p>\n

Notes for editors:<\/p>\n

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  1. A full list of the commissioners with some background on each can be found here: http:\/\/www2.warwick.ac.uk\/research\/warwickcommission\/about\/commissioners<\/li>\n<\/ol>\n
      \n
    1. In establishing the Warwick Commissions, of which this is the first, the University of Warwick aims to draw on its scholars, their expertise and their networks of professional contacts to address issues of global importance.<\/li>\n<\/ol>\n
        \n
      1. The Warwick Commission is an initiative of the University of Warwick and is a major programme of independent annual inquiries into issues of global importance.\u00a0 The University of Warwick is one of the UK\u2019s most dynamic and progressive universities and is ranked in the top ten in the UK for the quality of both its research and teaching. Warwick has been a pioneer since its creation forty years ago.\u00a0 It was one of the first UK universities to forge partnerships with commerce and industry to underpin its academic research; and it has been proactive in diversifying its income base by developing commercial businesses and services.\u00a0 Warwick\u2019s vision is to become a world leader in research and teaching and to emerge as one of a small group of global brands in higher education.<\/li>\n<\/ol>\n<\/blockquote>\n","protected":false},"excerpt":{"rendered":"

        The Warwick Commission report on the world trade system … Experts\u00a0Say Consensus Should No Longer Be Deal Breaker\u00a0in World Trade The Warwick Commission, a panel of leading specialists on world trade is this week publishing the results of its 10 month study of the state of the world trade system. They are concerned about what …
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