Okonjo-Iweala: World trading system showing strong resilience despite U.S. disruptions
Dr Ngozi Okonjo-Iweala, Director-General of the World Trade Organisation (WTO), has declared that the global trading system is showing “very strong resilience” despite facing what she described as “the biggest disruption in global trade in 80 years” due to unilateral U.S. tariff actions.
Speaking at the Next 3 Billion event by Semafor on the sidelines of UNGA 80, Okonjo-Iweala revealed that while U.S. trade policies have “knocked” and “battered” the WTO system, approximately 72% of world trade still operates under WTO terms, down from 80% before the tariff implementations.
“The unilateral actions of the U.S., yes, did undermine the system and the rules,” she stated. “But what is surprising, when we finished the analysis, we went from 80% to 72%. That’s almost three quarters of world trade on WTO terms.”
The WTO chief described the current situation as having “a stable core of the trading system existing in an unstable equilibrium,” attributing the instability to ongoing uncertainty in global trade relations.
Despite the challenges, Okonjo-Iweala noted that the crisis has reinvigorated global interest in the multilateral trading system. “Trade was not a sexy subject,” she observed. “We were just doing our thing and trying to make the system work, but now trade is on the lips of everyone.”
She highlighted recent coalition-building efforts among WTO members, citing a group of 14 countries led by Singapore, the UAE, Switzerland, Iceland, and New Zealand that have banded together to strengthen and reform the system.
The Director-General emphasised that regional trade agreements complement rather than compete with the WTO, noting that most such agreements are “built on the WTO platform.”
However, she cautioned against complacency, acknowledging that some U.S. criticisms of the system have merit, and that developing countries’ concerns about the system working better for them are also valid.
