By Olivia Le Poidevin
Opening of 14th WTO ministerial meeting in Cameroon
YAOUNDE, March 26 (Reuters) - The World Trade Organization chief called on countries on Thursday to overhaul global trade rules, telling them the old world order had gone for good following a year of turmoil sparked by U.S. tariffs and geopolitical tensions.
Ngozi Okonjo-Iweala set out a list of problems facing the organisation - including the paralysis of its dispute-settlement mechanism - at the start of a four-day meeting of the body in Cameroon.
"The world order and multilateral system we used to know has irrevocably changed. We will not get it back ... We must look to the future," the WTO director-general said.
Some diplomats and trade officials warned that without an agreement on reforms, countries could start abandoning the ideal of a rules-based global trade system, and set their own regulations.
The gathering in Yaounde comes amid concerns over the impact of the U.S.–Israeli war on Iran, and follows years of stalled multilateral trade deals.
US URGES 'HONEST AND FRANK' TALKS
In a statement to members, U.S. Trade Representative Jamieson Greer urged an "honest and frank conversation" on reforms, as well as on the WTO's core rules. He took aim at the organisation for contributing to what he described as "severe and sustained imbalances," which he said the U.S. had sought to correct through its trade policies.
AVOIDING HALF-BAKED REFORMS
The U.S. supports reforms but is resisting a detailed work plan, while the EU, Britain, and China back one, internal reform documents seen by Reuters show.
UK trade minister Chris Bryant warned of potential fragmentation if no deal is reached.
"My anxiety is if we ministers don't get this week right, you might see a disorderly collapse of the WTO and some people writing a new rulebook," Bryant said.
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Statements by the EU and U.S. laid out priorities that the WTO needs to address, including transparency on countries' use of subsidies, as well as allowing groups of members to form their own agreements.
The current decision-making process, which requires consensus from all members, has frequently stalled due to objections from individual countries. Greer said that allowing more flexibility into the system through bilateral deals among like-minded smaller groups would be "part of the new world order."
India's Minister of Commerce and Industry Piyush Goyal, however, told delegates that there should be a consensus accord to allow a subset of members to make its own decisions.
Goyal also cast doubt on U.S. efforts to extend a global ban on cross-border e-commerce duties, saying that it warranted "careful reconsideration." India is concerned about a loss of tariff revenue.
A senior diplomatic source and a diplomat from an African country expressed uncertainty over whether India would agree to a temporary extension.
Greer said in a statement that Washington was "not interested" in a temporary extension to the ban, only a permanent extension.
A half-baked outcome on e-commerce and reforms would be a form of failure, John Denton, the secretary-general of the International Chamber of Commerce, which represents 50 million companies globally, warned.
FOUNDATIONAL ISSUES
Ministers discussed core issues relating to the WTO, including its Most-Favored Nation trading principle, which requires countries to apply the same tariffs to all trading partners.
MFN currently governs 72% of global trade, but Greer said the system had failed to promote reciprocity within the trade system.
The EU has signalled it wishes to rethink MFN, mainly due to its concerns about China. EU Commissioner for Trade and Economic Security Maros Sefcovic told delegates that Brussels envisages a "more flexible framework of rules" where interested members can move forward through plurilateral agreements.
However, China's Commerce Minister Wang Wentao told delegates that MFN must remain the bedrock of the global trade system, warning that if member states begin treating each other differently, it would open a "Pandora's Box".
(Reporting by Olivia Le Poidevin; Editing by Chris Reese, Lincoln Feast, Andrew Heavens and Sharon Singleton)
