ICYMI: The U.S. should save the WTO appellate body

Nov 20, 2019 by AFP

Americans for Prosperity Trade Policy Fellow Dan Pearson | The Hill

The World Trade Organization (WTO) Appellate Body is about to expire, driven to oblivion by a U.S. decision to block the appointment of new judges. In December, terms of two of the three remaining members of the seven-member tribunal will end, causing the Appellate Body to go dormant due to lack of a quorum. At this time of acrimony and strife in international trade, demise of the Appellate Body would create still one more threat to the future of the global trading system.

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The WTO dispute settlement system is worth saving. It has adjudicated hundreds of cases between member countries, including more than 120 brought by the United States against trade-distorting measures of other nations. Although not perfect, the dispute settlement system has led to meaningful reductions in unfair practices and has helped to strengthen the rules-based international trading system. Since the United States is the world’s largest trading nation, it has been one of the major beneficiaries of the WTO process.

The Trump administration has identified several shortcomings with respect to the Appellate Body’s procedures and decision making. It has been unwilling to engage in negotiations on specific issues until other countries acknowledge that the Appellate Body has strayed from its original mandate and are prepared to discuss the reasons why. Ensuring this doesn’t happen again likely would require new enforcement measures that would satisfy the United States. Under these circumstances, the Trump administration has chosen not to offer a plan of its own.

It’s time for that to change. Recently, Americans for Prosperity joined other free trade organizations in a letter urging the president to lead reform efforts by developing and presenting to WTO members a reform proposal that meets U.S. objectives.

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The administration should strike while the iron is hot, capitalizing on its leverage by stating publicly that its goal is not to kill the Appellate Body, but to reform it. This would be a clear signal that the dispute settlement system should be maintained, as long as other countries are willing to negotiate meaningful reforms.

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By acting now, President Trump and his team could lead a process of constructive change. Doing so would strengthen the global trading system and boost worldwide business confidence. Vibrant international trade creates opportunities for the thousands of American companies and millions of workers that earn all or part of their livelihoods from the global economy.

For further information or to set up an interview, please send an email to GCipriano@afphq.org.

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