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No U.S. Consensus Yet on Approach to WTO Crisis

The Trump administration’s on-going refusal to confirm World Trade Organisation Appellate Body judges will result in a lack of a quorum for that body on 10 December. In response, various parties are trying to mediate the crisis. For example, a bi-partisan group of House Ways and Means Committee members introduced a non-binding resolution on 6 December urging the U.S. trade representative to work with other WTO members on WTO reforms, but with the goal to “get the Appellate Body in working order.”

Introduced by Reps. Ron Kind (Democrat-Wisconsin) and David Schweikert (Republican-Arizona), the resolution recommends that the United States work to (i) address long-standing concerns with the  Appellate Body, (ii) improve the speed and predictability of dispute settlement, (iii) increase transparency at the WTO, (iv) ensure that WTO members invoke special and differential treatment for developing countries only in “fair and appropriate circumstances”, and (v) update WTO rules to address the needs of the United States and other free and open economies in the 21st century.

A press release accompanying the resolution includes supporting statements from seven sponsoring Ways and Means Committee members. Interestingly, Washington State Democrat Suzan DelBene said that “while there is no doubt that the WTO requires significant reforms to deal with countries like China, I believe that a functioning WTO still offers the United States the best chance to ensure that trade liberalization is achieved in a manner that is consistent with our values.” The press release notes that the Ways and Means Committee has jurisdiction over U.S. trade policy, including the Office of the U.S. Trade Representative.

Meanwhile, a letter to President Trump by Americans for Prosperity takes a slightly different approach. It suggests accepting principles put forward by a group chaired by New Zealand’s WTO ambassador, David Walker, along with term limits for Appellate Body staff and annual reviews of Appellate Body performance by a new oversight committee. The letter notes that by adopting the Walker Principles along with related enforcement measures and term limits “WTO members would be agreeing with the United States that the Appellate Body has overreached.” Americans for Prosperity argues that the United States should support the appointment of new Appellate Body judges if these reforms are made.

Dennis Shea, U.S. ambassador to the WTO, repeated on 6 December that the three-day WTO General Council meeting beginning on 9 December was unlikely to sufficiently address U.S. concerns. Shea declared that “we will not be able to move forward until we are confident we have addressed the underlying problems and have found real solutions to prevent their recurrence.” Shea’s statement emphasised concern that special and differential treatment is “raised by some to deflect engagement on substance and by others to maintain outdated asymmetries.” He also criticised other WTO members’ transparency in notifications as well as general committee functioning. Whether the administration will be more receptive to congressional or U.S. business concerns, or to the concerns of other WTO members, remains an open question.

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