The United States opposed the appointment of Nigeria’s former finance minister in the final stages of selecting the top leader of the global trade watchdog, adding uncertainty to the future of the World Trade Organization. The trade dispute between the United States and China has weakened the body at a time of global economic turmoil.
The WTO’s nominating committee on Wednesday (Oct. 28) recommended Ngozi Okonjo-lweala’s appointment as director general. If elected, she would be the first African and first woman director general of the WTO.
However, the decision would require consensus approval by individual member states, which means that any one of the 164 WTO members could block Iweala’s appointment.
The eight candidates vying for the WTO’s top job were narrowed to two in the first two rounds of negotiations, leaving only Iweala and South Korea’s current trade minister, Yoo Myung-hee, to be appointed. The organization said Iweala should be the next head of the organization because she has broad cross-regional support.
WTO spokesman Keith Rockwell said, “All but one of the delegations that commented today expressed strong support for the process.” He told reporters after the closed-door meeting that the dissenting view was from the United States.
The Trump administration, which views the WTO’s handling of global trade as unfavorable, said it would continue to support another woman, Yu Mingxi, at the helm.
The Office of the U.S. Trade Representative, which provides trade policy for the Trump administration, said Wednesday that the WTO “must be led by someone with practical experience in the field” and that Yu “stands out” as a trade expert.
The office also said in a statement: “These are very difficult times for the WTO and for international trade: 25 years of no multilateral tariff negotiations, an out-of-control dispute settlement mechanism, and too few members meeting basic transparency obligations. The WTO is in urgent need of major reform.”
Gary Hufbauer, a trade expert at the Peterson Institute for International Economics, told VOA that Ivrea’s close ties to Beijing have raised alarms in Washington.
He said, “The biggest objection is Ivella’s close ties to China. She works at the Asian Infrastructure Investment Bank and appears to have good relations with Chinese officials.” Iweala is a member of the international advisory board of the Chinese-sponsored Asian Investment Bank.
The Trump administration has pursued adjustments to U.S. trade policy since taking office in 2017. They have argued that the WTO was unfair in ruling on the U.S. case and failed to address many of China’s unfair trade practices, from forced technology transfers to manipulating exchange rates.
According to Bloomberg, which cites people close to U.S. Trade Representative Lighthizer, the Trump administration believes that Ivila, a longtime World Bank executive, is too ideologically aligned with the globalists.
Rockwell said WTO members will hold a general council meeting on Nov. 9 on the selection of the director general, and hope to make a decision on the final choice of director general by then.
Some African countries, the Caribbean and the European Union have publicly expressed support for Iweala. If members cannot reach a consensus, the selection of the new director general will, as a last resort, be conducted by vote, a first for the global trade body.
Who will it be?
The WTO was established in 1995 to promote openness to trade. Following the departure of former WTO Director-General Roberto Azevedo of Brazil in August, a year early, the organization has experienced a leadership vacancy and is now helmed by four deputies.
Settling trade disputes between countries is one of the WTO’s most important functions. The function was formally suspended after the United States disagreed with the appointment of new judges to the organization’s appellate body, which was unable to reach the minimum number of three for deliberation and review.
Whoever is ultimately elected will face considerable challenges: a plunge in trade volumes caused by the new coronavirus, a rise in trade protectionism, and accusations by the United States that the WTO is biased in favor of China and that it is withdrawing from the organization.
However, trade experts say the power of the WTO director general is bound by member states, and are pessimistic about the hope that the new officer will be able to resolve the conflict between the world’s two largest economies.
“Regardless of who leads the WTO, I don’t think the director general will be able to do much to heal the conflicts between the U.S. and China,” Havebauer told VOA. “These conflicts will be resolved bilaterally between Washington and Beijing. All the director general can do is try to keep the WTO mechanism working.”
Both Ivella and Yu have experience in government service and international trade, and both graduated from U.S. universities.
The 66-year-old Ivila, a dual citizen of Nigeria and the United States, is Nigeria’s first female finance and foreign minister. She spent most of her career as an economist at the World Bank, eventually serving as an executive vice president and at one point as a candidate for the Bank’s presidency.
Iweala currently chairs the board of the International Vaccine Alliance (Gavi), which promotes fair global distribution of vaccines. She says the WTO should play a role in helping poor countries get access to drugs and vaccines for new crowns.
In public interviews, Yvira has described herself as a “doer,” saying she has the political clout and extensive experience advocating for reform and is the right person to help get the WTO back on track.
Yu Myung-hee has more experience in trade policy. At 55, she is the first female trade minister in Korea. During her 25 years of government, she has been involved in some of Korea’s most important trade negotiations, including those with China and the United States.
Yu has described the WTO as “at a crossroads.” In her campaign video for director general, she said that members must now work to rebuild trust and reform the global trading system.
She said, “The global economy is under tremendous pressure. That’s why the WTO is more important than ever.”
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