- The Washington Times - Friday, January 21, 2005

The World Trade Organization (WTO) recently completed a vital exercise for an institution of its size and significance: self-examination. A former director general, Peter Sutherland, oversaw a report that looked back at the WTO’s 10-year history. The Sutherland report made some welcome recommendations, particularly its call for greater transparency in its dispute-settlement proceedings.

The Bush administration has long advocated public meetings in WTO dispute settlements. Such an approach would help ensure fairness and help the WTO clarify its image. That principle of transparency should also be applied to the dispute-resolution tribunals established under NAFTA. The outgoing U.S. Trade Representative Robert Zoellick and both Republican and Democratic lawmakers have advocated for years making the tribunals more open, but they continue to conduct closed-door proceedings. Since the rulings of the NAFTA tribunals take precedence over U.S. court findings, it is critical that they be opened up to more public scrutiny.

The Sutherland report also claimed that bilateral and regional trade accords threaten progress in global trade talks. This is only partially true. While the global trade agreements go farthest in liberalizing the international trading system, the trade deals made on a regional or bilateral basis can put pressure on some more stubborn members to become more flexible. Also, member countries weigh carefully any impact that bilateral or regional trade deals could have on global talks. Some Latin American countries, particularly Brazil and Argentina, have resisted reaching broad trade agreements with either the European Union or the United States to maintain pressure on those parties to substantively dismantle farm subsidies in the ongoing global round of talks.

The more obvious culprit of slow progress in the trade arena is domestic political pressure. While trade liberalization helps keep economies lean and competitive over the longer term, there are often short- to long-term adjustment costs that lead to job losses.

The WTO has been a useful vehicle towards freer global trade, and for the most part, a fair arbiter of trade disputes. Over the next 10 years, though, the WTO can be only as significant as its members’ will to trade.

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