MC13: A Snapshot of Progress, Challenges and the Road Ahead

Image Source: World Trade Organization (WTO)

The 13th Ministerial Conference (MC13) of the World Trade Organization (WTO), held in Abu Dhabi in February, brought together 166 trade ministers’ delegations to address pressing issues in global trade. Outcomes offer insights into the evolving landscape of cross-border trade challenges and opportunities for enhanced international cooperation.
 
Milestones Achieved:  Amid ongoing challenges on the role and relevance of the WTO, MC13 demonstrated the importance and potential for furthering multilateral cooperation in trade governance and trade facilitation.

• Accession of two least-developed countries, Comoros and Timor-Leste, expanded the WTO's membership to represent a more comprehensive picture of the global trade landscape and underscored the WTO as a valuable international organization pursued by nations seeking to enhance their trade opportunities [i].
• Extension of the e-commerce moratorium until 31 March 2026 emerged as objections from opposing countries (India and South Africa) were lifted, paving the way for a renewed commitment to facilitate trade in the digital age, providing stability and certainty for businesses engaging in e-commerce activities, and safeguarding for at least two more years no customs duties on electronic transmissions.
• While core issues of the dispute settlement system remain unresolved, WTO members agreed to finalize a functional dispute resolution system by the end of 2024 [ii]. This highlights a commitment to addressing longstanding concerns and improving the efficacy of the WTO's dispute settlement process.
• Plurilateral agreements on domestic services regulation entered into force which aim to increase transparency, predictability and efficiency of procedures for authorization of service providers, and foster a more favorable regulatory environment for businesses, especially micro, small, and medium-sized enterprises (MSMEs) and women entrepreneurs [iii].
• Finally, led by a coalition of developing and least-developed countries, the Investment Facilitation for Development (IFD) agreement received support from over 120 parties, highlighting its significance in promoting clear global standards to facilitate and foster investment [iv].

 
Challenges:  Roadblocks to progress remain.  The inability to address fisheries and agricultural issues reflects the ongoing complexities of balancing national interests and collective goals within the WTO framework.

• A comprehensive agreement on fisheries subsidies remains one of the most significant challenges for WTO members. Despite efforts to curb overfishing and illegal fishing practices, disagreements over special and differential treatment provisions for developing countries persist without major breakthroughs beyond the MC12 deal [v]. The proposed deal faced resistance from India arguing for unlimited subsidies to its fisheries operation within its sovereign waters and from Pacific Island nations advocating for stricter restrictions through a cap on subsidies for large subsiding countries [vi].
• Similarly, discussions on agriculture stalled, underlining long-standing challenges in negotiations on various topics such as subsidies, tariffs, and other domestic support programs. Divergences remain on how to balance food security and public stockholding measures while ensuring fair trade practices and limiting trade-distorting subsidies as highlighted by the G33, a coalition of developing nations focusing on agricultural issues [vii].

 
Outlook for the Future: Navigating Challenges Ahead
Looking ahead to future engagement, it is important to highlight that despite former President Donald Trump's criticism of the organization and the proposed WTO withdrawal legislation introduced by Members of the U.S. Congress, there are 31 governments still in the queue requesting to join the global trade community [viii]. Despite skepticism that soared in recent years and the ongoing challenges of WTO, governments around the world continue to perceive the organization to be valuable to join.
 
Lingering issues including fisheries subsidies and agriculture require renewed and ongoing efforts and cooperation to reach meaningful agreements as preparations begin for the next WTO ministerial in 2026. Lack of progress in these areas translates into uncertainty and potential market distortions. Consequently, businesses may encounter barriers to market access, encounter difficulties in complying with inconsistent regulations, or face increased competition due to unfair subsidies.
 
Entrenched positions reflect broader tensions within the WTO, where diverging national interests often impede consensus-building and hinder the organization's effectiveness. Influential members, such as the United States and India, have employed blocking tactics and have obstructed other broader discussions in the WTO [ix]. As the global community grapples with the complexities of trade governance and facilitation, addressing obstacles and roadblocks requires sustained efforts to bridge ideological divides and foster constructive dialogue among WTO members.

[i] Ministers approve WTO membership of Comoros and Timor-Leste at MC13 World Trade Organization (26 February 2024)
[ii] Dispute Settlement Reform Ministerial Decision World Trade Organization (2 March 2024)
[iii] New disciplines on good regulatory practice for services trade enter into force World Trade Organization (27 February 2024)
[iv] Three-quarters of members mark finalization of IFD Agreement, request incorporation into WTO World Trade Organization (25 February 2024)
[v] Agreement on Fisheries Subsidies World Trade Organization
[vi] Fisheries deal at WTO insufficient for Pacific islands, Fiji says Reuters (29 February 2024)
[vii] G-33 Ministerial Statement on Agriculture Trade Negotiations at the 13th WTO Ministerial Conference World Trade Organization (25 February 2024)
[viii] Joint Resolution of Withdrawing approval of the Agreement Establishing the World Trade Organization Josh Hawley U.S. Senator for Missouri; Members and Accessions World Trade Organization
[ix] No deals on fish, agriculture at MC13; e-commerce moratorium extended Inside U.S. Trade (1 March 2024); WTO MC13: India to oppose any negotiation mandate on non-trade issues Business Standard (7 February 2024)

Written by Amanda (Hsinyi) Lin