Repeat mission

WTO Director-General Azevêdo eyes fighting anti-trade rhetoric in second term

By: Chris Gillis
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Photo: 360b/Shutterstock
   The World Trade Organization Director-General Roberto Azevêdo will be back for a second term by default, as no other candidates stepped up as potential candidates.
   During the WTO’s open period for director-general nominations—between Nov. 3, 2016 and Jan. 4, 2017—no other countries within the trade body put forth a candidate to run against Azevêdo.
   The WTO has had only five director-generals since its founding 21 years ago. All but one served a single term, the exception being Pascal Lamy, Azevêdo’s predecessor, who also ran unopposed for a second term and was reappointed by consensus.
   “It’s just like the U.S. president—a DG can serve for two four-year terms,” said a WTO spokesperson, in response to an Adam Smith Project inquiry. “Our ‘electoral college’ is the membership, which appoints the DG on a consensus basis.
   Azevêdo has been praised by trade negotiators worldwide for his persistence in moving these agreements to fruition, sometimes at difficult odds.
   “I am confident that the WTO stands stronger today than it did in 2013,” Azevêdo said. “We are now in a position to build on these achievements.”
   He pointed out that in the immediate years ahead, there are further opportunities to “strengthen the global trading system,” especially among the organization’s developing country members.
   “There remains important work to do to continue developing all areas of our work, from capacity building to dispute settlement to monitoring, research and analysis, and beyond,” Azevêdo said. “On the negotiating front, members have committed to advancing the remaining Doha issues, while many have also raised other issues for discussion.
   “The precise route forward will be determined by members, but there is no question that levels of engagement and interest are high, and that recent successes have energized this work, thereby increasing the likelihood that significant further progress can be made,” he added.
   However, Azevêdo has warned about the harmful effects that recent anti-trade rhetoric, as well as actions, from around the world, including the Trump administration’s dissolution of the Trans-Pacific Partnership between the United States and 11 other Pacific countries, could have on the positive moment of global trade in recent years.
   The WTO chief acknowledged that trade may cause economic disruption to certain industries and communities through the outsourcing of work and jobs overseas.
   “On top of that, there is also a perception that trade serves only rich countries and big companies—and that poorer countries and smaller companies are left behind,” he said in an Oct. 20 speech before the Confederation of Norwegian Enterprise.
   “While I would dispute much of this, it is certainly the case that the benefits of trade still don’t reach as many people as they should,” he added. “That’s one reason that today’s slowdown in global economic performance has given rise to the anti-trade rhetoric that we are beginning to hear more and more.”
   Azevêdo, as he’s noted in recent statements and speeches defending trade, said the impact of trade on sending manufacturing jobs overseas is “overstated,” citing trade is a “relatively minor cause of job losses.” Instead, he said the fault lies more with technological innovation.
   “Almost 50 percent of existing jobs in some developed countries are at high risk of automation today. And the number is higher in many developing countries,” he explained. “This is the real economic revolution that is happening today.”
   To deal with trade and technological changes, Azevêdo said countries have a responsibility to ensure their workers have the right skills to take on economic shifts. For the WTO’s part, it must promote an open global trade system that “is truly available to all, and [ensure] that it continues to deliver those benefits that we want more people to enjoy,” he said.

Almost 50 percent of existing jobs in some developed countries are at high risk of automation today. And the number is higher in many developing countries.

   Azevêdo joined Brazil's Foreign Service in 1984 and his first diplomatic posting was to Washington in 1988. He served on various WTO dispute settlement panels after being assigned to Geneva in 1997. From 2006 to 2008, he was vice minister for economic and technological affairs in Brazil’s Foreign Ministry and became the country’s chief trade negotiator at the Doha Round and for other WTO issues. In 2008, Azevêdo was appointed Brazil’s permanent representative to the WTO.
   “I stand ready to serve as director-general for a second term,” Azevêdo said in a statement to the WTO General Council chairman. “I would welcome the opportunity to continue working to strengthen the multilateral trading system in the service of growth and development around the world.”
   During his time in office, he’s been credited with strengthening the WTO dispute settlement process, overseeing the addition of five new members (Yemen, Seychelles, Kazakhstan, Liberia and Afghanistan), increasing technical assistance and capacity building, and enhancing the organization’s monitoring to ensure adherence to rules by the members.
   Also during this period, the WTO ushered in an expanded Information Technology Agreement (ITA) and implemented the long-awaited Trade Facilitation Agreement (TFA).
   The updated ITA was concluded at the WTO Nairobi Ministerial Conference in December 2015 and eliminates tariffs on products valued collectively at more than $1.3 trillion in annual trade. The initial ITA was approved in December 1996 and covered an estimated $1.6 trillion in global trade in 2013, the WTO noted.
   The new ITA eliminates import tariffs and other duties on another 201 “new-generation” information and communication technology products either immediately or over the next three years. By 2019, it’s expected that 95.4 percent of participants’ import duties on these products will be fully eliminated, with tariffs remaining on only a small range of products, which will be completely removed by 2021 or 2023, the global trade body said.
   As of Nov. 3, the WTO said the majority of the participating countries in the ITA have implemented their tariff commitments under the deal. The WTO said the agreement received a “major boost” when China submitted its ITA expansion commitments Oct. 26. China’s Standing Committee of the National People’s Congress approved the expanded ITA on Sept. 3, and the country began implementing its first tariff cuts on covered goods on Sept. 15.
   “The expanded ITA was concluded by 24 participants representing 53 WTO members, but the benefits are being extended to all 164 WTO members, meaning they will all enjoy duty-free access to the markets of the members eliminating tariffs on these products,” the WTO said.
   Concluded at the WTO’s 2013 Bali Ministerial Conference after 10 years of negotiations, the TFA contains provisions for expediting the movement, release and clearance of goods, including goods in-transit. It also sets out measures for cooperation between customs administrations on trade facilitation and compliance issues, and strengthens technical assistance and capacity building for trade facilitation.
   The TFA will officially enter into force once two-thirds of the WTO membership has formally accepted the agreement. In January 2015, the United States became the third country to ratify the agreement.
   Yet the TFA was subsequently held up by India’s attempt to link the agreement to food security. A resolution was reached in November 2014, allowing the TFA to move forward.
   According to the WTO, implementation of TFA is expected to increase global merchandise exports by up to $1 trillion per year. It will enter into force once two-thirds of the WTO members have domestically ratified the so-called “Protocol of Amendment and notified the WTO of their acceptance of this protocol. Only three more ratifications are now required before it enters force.”
   Azevêdo’s current term as WTO chief expires Aug. 31. The WTO General Council will officially recognize Azevêdo’s election to a second term as director-general by May 31.